Crude oil futures stop rising in Asia after a sustained rally but tight supply, strong demand outlook remains

Crude oil futures stop rising in Asia after a sustained rally but tight supply, strong demand outlook remains

MOSCOW (MRC) -- Crude oil futures were stable to lower in mid-morning trade in Asia Oct. 12 after a sustained rally, with expectations of tight supply and strong demand set to continue supporting prices in the near term, reported S&P Global.

At 11 am Singapore time (0300 GMT), the ICE December Brent futures contract was down 7 cents/b (0.08%) from the previous close at USD83.58/b, while the NYMEX November light sweet crude contract was 13 cents/b (0.16%) lower at USD80.39/b.

"Oil prices may be taking a breather today after surging more than 20% since late August on tighter oil supplies and increasing demand," IG market strategist Yeap Jun Rong told S&P Global Oct. 12, adding that prices were still above USD80/b and expectations of a near-term uptrend remain intact.

Other analysts said the oil market continued to be supported by high gas and coal prices that raise the prospect of more switching to oil for power generation.

Tightened US supply has supported prompt-month WTI prices and contributed to the widening backwardation of the WTI forward curve. Front-month WTI settled at a USD7.33/b premium to the year-ahead contract Oct. 11, the widest backwardation since mid-July.

ANZ research analysts in a note Oct. 12 raised their 2021 oil demand forecast by 450,000 b/d amid continuing recovery in transportation fuel requirements as pandemic mobility restrictions ease across the globe.

"Demand is improving in China, while easing restrictions in other countries are keeping oil demand prospects strong. Transportation fuels are leading the charge as consumers return to the road. High gas prices are inducing gas-to-oil switching in heating and industrial sectors," the ANZ analysts said.

As MRC informed before, US commercial crude stocks fell 3.48 million barrels to 413.96 million barrels in the week ended Sept. 17, to more than 8% below the five-year average, Energy Information Administration data showed. Stocks were last lower Oct. 5, 2018.

We remind that in late August, 2021, US crude stocks dropped sharply while petroleum products supplied by refiners hit an all-time record despite the rise in coronavirus cases nationwide, the Energy Information Administration said. Crude inventories fell by 7.2 million barrels in the week to Aug. 27 to 425.4 million barrels, compared with analysts' expectations in a Reuters poll for a 3.1 million-barrel drop. Product supplied by refineries, a measure of demand, rose to 22.8 million barrels per day in the most recent week. That's a one-week record, and signals strength in consumption for diesel, gasoline and other fuels by consumers and exporters.

We also remind that US crude oil production is expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, the US Energy Information Administration (EIA) said in a monthly report, a smaller decline than its previous forecast for a drop of 210,000 bpd.
MRC

Epsilyte raises October EPS prices on higher feedstock costs

Epsilyte raises October EPS prices on higher feedstock costs

MOSCOW (MRC) -- Epsilyte (The Woodlands, Texas), a leading North American producer of expandable polystyrene (EPS), has announced an increase in its prices of all EPS grades for October shipments on higher feedstock costs, said the company.

Thus, the price of the company's EPS grades went up by 5 cents/pound (cts/lb) or USD110/tonne, effective 1 October, 2021 or as contracts allow.

Escalating feedstock costs necessitated this adjustment of Epsilyte's October prices.

As MRC reported earlier, Epsilyte increased its September EPS prices in the region by the same amount.

EPS is a rigid form of polystyrene (PS) used in insulation foams for the construction industry as well as for packaging.

According to ICIS-MRC Price report, prices of Russian EPS remained steady last week. Spot prices of Russian material were at Rb188,000-205,000/tonne CPT Moscow, including VAT. Some market participants continued to report a shortage of EPS in the domestic market. Demand for material was strong.

Epsilyte is owned by private equity firm Balmoral Funds (Los Angeles, California). Epsilyte is one of North America’s leading producers of expandable polystyrene resin. The company is focused on solving customer needs for efficient, high-R value EPS. This includes reducing energy usage in buildings, ensuring safe and healthy food through innovative packaging technology, and participating in infrastructure investment both in the United States and abroad.
MRC

Ukrainian PVC imports down by 23% in Jan-Sep 2021, exports up by 17%

MOSCOW (MRC) -- Imports of suspension polyvinyl chloride (SPVC) into Ukraine fell in the first nine months of 2021 by 23% year on year, totalling 20,800 tonnes. Export sales of Ukrainian PVC rose by 17% year on year partially due to record high prices in a number of regions of the world, according to MRC's DatasScope report.

Last month's SPVC imports to the Ukrainian market decreased to 2,300 tonnes from 2,700 tonnes in August, Ukrainian companies reduced their shipments of polymer from the USA. Overall SPVC imports reached 20,800 tonnes in January-September 2021, compared to 26,800 tonnes a year earlier. Limited export quotas of European and North American producers were the main reason for such a major fall in imports.

European producers with the share of about 86% of the total imports over the stated period were the key suppliers of resin to the Ukrainian market.
Last month, Karpatneftekhim maintained its export sales at a good level, export sales of Ukrainian resin were 16,300 tonnes versus 13,300 tonnes in August. Overall, slightly less than 146,000 tonnes of PVC were shipped for export in the first nine months of 2021, compared to 124,300 tonnes a year earlier.

MRC

Celanese introduces Hostaform RF for rotomolding tank applications

Celanese introduces Hostaform RF for rotomolding tank applications

MOSCOW (MRC) -- Celanese Corporation, a global chemical and specialty materials company, has announced the launch of Hostaform RF, a low permeation acetal copolymer tailored for Small Off-Road Engine and marine fuel tanks, hydraulic reservoirs, and industrial bulk containers, as per the company's press release.

“Celanese’s long history and expertise in acetal polymer formulation and processing helped us design a specific solution optimized for the rotational molding process,” said Adam Larkin, Senior Manager, Acetal Product Marketing. “This single-layer solution enables optimal tank designs without any secondary operations, thereby increasing efficiency and productivity for our customers.”

As the leading acetal copolymer supplier for automotive fuel systems, Celanese has specifically formulated Hostaform RF to deliver an easy-to-use, drop-in solution for traditional rotational molding. The rotational molding method creates parts by placing material inside a heated, hollow, rotating mold where material is dispersed evenly.

The new RF resin system delivers the excellent mechanical and chemical-resistant properties of Celanese’s Hostaform acetal copolymer while also providing a single-layer solution versus multilayer tank systems requiring secondary treatment, such as fluorination. Hostaform® RF delivers an unprecedented balance of impact and durability performance along with low fuel permeation that customers need to meet US EPA regulations.

We remind that, as MRC reported earlier, Celanese Corporation has recently announced a force majeure (FM) in China for vinyl acetate monomer (VAM) shipments from its plant Nanjing, China. Celanese has temporarily shut down its acetic anhydride and VAM production in Nanjing to comply with recent requirements of government departments in order to achieve dual energy consumption targets in the Jiangsu Province in 2021. Thus, its VAM plan with the capacity of 300,000 mt/year was shut on 17 September, 2021, and its was expected to resume operations in late September.

According to MRC's DataScope report, June EVA imports to Russia fell by 18,32% year on year to 2,400 tonnes from 2,940 tonnes a year earlier, and overall imports of this grade of ethylene copolymer into the Russian Federation rose in January-June 2021 by 26,19% year on year to 22,020 tonnes (17,450 tonnes in the first seven months of 2020).

Celanese Corporation is a global technology leader in the production of differentiated chemistry solutions and specialty materials used in most major industries and consumer applications. Based in Dallas, Celanese employs approximately 7,700 employees worldwide and had 2020 net sales of USD5.7 billion.
MRC

European PVC prices rose by EUR60/tonne for CIS markets in October

European PVC prices rose by EUR60/tonne for CIS markets in October

MOSOCW (MRC) - Negotiations on European polyvinyl chloride (PVC) prices for October shipment to the CIS markets began last week. Under the pressure of rising ethylene prices and the cost of electricity in the region, European producers raised their export prices for the current month by EUR60/tonne, and in some cases even increased by EUR90/tonne, according to the ICIS-MRC Price Report.

October contract price of ethylene was agreed up by EUR25/tonne from the previous month, which theoretically allows to talk about an increase of EUR12,5/tonne in the net cost of PVC production. But recently, the price of electricity has risen significantly, which also affects the cost of polymer production.

Because of significant shortage of PVC in the region and an increase in production costs in October, European producers increased export prices by EUR60/tonne or more.

More than a quarter of European capacities are shut due to planned and unscheduled shutdowns for repairs , and the unstable work of producers in the US and the decline in exports have negatively affected the balance of the European PVC market.

As a result, over the past three months, some buyers from CIS countries reported an almost complete lack of PVC for them from some producers in Europe.

Overall, deals for October shipments of suspension polyvinyl chloride (SPVC) to the CIS markets were discussed in the range of EUR1 500-1 605/tonne FCA, whereas the previous month's deals were done at EUR1 440 - 1 515/tonne FCA.

MRC