Crude oil prices steady on demand concerns after renewed restrictions in Europe and Asia amid rise in coronavirus cases

Crude oil prices steady on demand concerns after renewed restrictions in Europe and Asia amid rise in coronavirus cases

MOSCOW (MRC) -- Oil prices edged higher on Tuesday but price gains were capped due to investor worries about oil demand after renewed restrictions were imposed in Europe and Asia amid a rise in coronavirus cases, reported CNBC.

Brent crude oil futures edged higher by 1 cent to USD74.40 a barrel by 0113 GMT, while US West Texas Intermediate (WTI) crude futures gained 1 cent to USD71.30.

“Energy traders don’t want to bet against OPEC+ but all the short-term risks from omicron to Fed tightening is proving to be very disruptive to the short-term outlook for oil prices,” said Edward Moya, senior analyst at OANDA.

“The virus spread across Europe is delivering a bigger hit than expected and when you calculate family gatherings for the holidays, the short-term outlook could get slashed over the next month.”

Governments around the world, including most recently Britain and Norway, were tightening restrictions to stop the spread of the omicron variant.

In China, major manufacturing province Zhejiang is fighting its first Covid-19 cluster this year, with tens of thousands of citizens in quarantine and virus-hit areas suspending business operations, cutting flights and cancelling events.

Still, the Organization of the Petroleum Exporting Countries raised its world oil demand forecast for the first quarter of 2022 and stuck to its timeline for a return to pre-pandemic levels of oil use, saying the Omicron coronavirus variant would have a mild and brief impact.

Supply meanwhile is expected to increase with the largest US shale basin’s output expected to surge to a record in January, according to a monthly forecast from the US Energy Information Administration on Monday.

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, EIA said in a monthly report earlier this year, a smaller decline than its previous forecast for a drop of 210,000 bpd.
MRC

Three people killed after explosion and fire at Yeosu chemical plant

MOSCOW (MRC) -- Three workers were found dead following a chemical factory explosion and fire at an industrial complex in the southern city of Yeosu, Monday, according to TheKoreaTimes with reference to firefighters.

The explosion and resultant fire occurred at 1:37 p.m. at a petrochemical manufacturing factory in the Yeosu Industrial Complex, 450 kilometers south of Seoul.

A total of seven people were working at a chemicals storage facility in the factory, and three of them were found dead in a nearby section, apparently due to the strong impact of the explosion. The other four were confirmed safe, the firefighters said.

The emergency authorities issued a Level-2 warning, which enables them to call in support, including firefighters, from other areas. But this was lifted at 5:11 p.m. after the firefighters successfully extinguished the fire.

The authorities said they are now looking into the exact causes of the accident.

We remind that, as MRC reported earlier, South Korea's GS Caltex shut its new mixed-feed cracker at Yeosu for maintenance on 27 August, 2021. This cracker resumed operations on 7 September, 2021, after the turnaround was completed. The new steam cracker, which started up around June 18, can produce 750,000 mt/year of ethylene and 410,000 mt/year of propylene.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,047,100 tonnes in the first ten months of 2021, up by 17% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,226,530 tonnes in January-October 2021, up by 26% year on year. Supply of propylene homopolymers (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding stat-copolymers of propylene (PP random copolymers) decreased significantly.
MRC

Air Products and thyssenkrupp to collaborate in developing projects supplying green hydrogen

MOSCOW (MRC) -- Air Products, a world leader in industrial gases megaproject development, and thyssenkrupp Uhde Chlorine Engineers, the world leader in technologies and comprehensive solutions for large-scale electrolysis plants, have announced the signing of a Strategic Cooperation Agreement (SCA), said thyssenkrupp on its site.

The two companies will collaborate exclusively in key regions, using their complementary technology, engineering and project execution strengths to develop projects supplying green hydrogen.

thyssenkrupp will deliver its technology and supply specific engineering, equipment and technical services for water electrolysis plants to be built, owned and operated by Air Products. The collaboration leverages thyssenkrupp’s technology supporting Air Products’ development of green hydrogen as an energy carrier for sustainable transportation, chemicals and power generation.

“The SCA with thyssenkrupp is an important element of our value chain in developing, building, owning and operating world-scale projects and supplying green hydrogen for mobility, energy and industrial applications. We look forward to applying our complementary strengths and delivering substantial sustainability benefits through transformational green hydrogen projects,” said Dr. Samir J. Serhan, Chief Operating Officer at Air Products.

As MRC reported earlier, Air Products will develop a USD4.5 billion clean energy complex near Burnside in Ascension Parish. This will also be the world’s largest permanent carbon dioxide sequestration endeavor to date. Air Products will construct a blue hydrogen manufacturing complex to produce more than 750 million standard cubic feet per day of blue hydrogen, with carbon dioxide from the manufacturing process captured and permanently sequestered. The plant will be the first carbon-capture project in Louisiana for Air Products, a world-leading industrial gas manufacturer that provides hydrogen and other gases to refineries, petrochemical plants and other customers in Louisiana, across the Gulf Coast and around the globe.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,047,100 tonnes in the first ten months of 2021, up by 17% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,226,530 tonnes in January-October 2021, up by 26% year on year. Supply of propylene homopolymers (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding stat-copolymers of propylene (PP random copolymers) decreased significantly.

Air Products (NYSE:APD) is a world-leading industrial gases company in operation for nearly 80 years. Focused on serving energy, environment and emerging markets, the Company provides essential industrial gases, related equipment, and applications expertise to customers in dozens of industries, including refining, chemical, metals, electronics, manufacturing, and food and beverage.

thyssenkrupp is a technology group with strengths in materials. Over 162,000 employees in 78 countries work with passion and technological know-how to develop high-quality products and intelligent industrial processes and services for sustainable progress. The company's portfolio includes leading technologies for the production of basic chemicals, fertilizers and polymers as well as complete value-chains for green hydrogen and sustainable chemicals.
MRC

PP imports to Ukraine increased by 1% in January-November

MOSCOW (MRC) -- Ukraine's polypropylene (PP) imports totalled about 126,000 tonnes in January-November of this year, up 1% year on year. The volumes of imports of propylene copolymers have increased, according to MRC DataScope.

November PP imports to Ukraine decreased to 12,600 tonnes from 13,300 tonnes a month earlier, local companies decreased their purchasing of propylene homopolymers (homopolymer PP) from Russia and Saudi Arabia. Overall imports of propylene polymers reached 126,000 tonnes in January-November 2021, compared to 124,400 tonnes a year earlier. The main decrease in imports accounted for homopolymer PP, while imports of some propylene copolymers increased.

The structure of PP imports by grades looked the following way over the stated period.

November imports of homopolymer PP into the Ukrainian market decreased to 8,700 tonnes, while a month earlier this figure was 10,700 tonnes. Producers from Russia and Saudi Arabia decreased their export volumes. Thus, overall homopolymer PP imports reached 93,900 tonnes in the first eleven months of 2021, down by 1% year on year.

Last month's imports of block copolymers of propylene (PP block copolymers) were about 1,700 tonnes, compared to 1,200 tonnes in October, a small decrease in supplies of injection moulding PP block copolymers was seen. About 12,700 tonnes of PP block copolymers were imported in the ten months of this year, compared to 12,300 tonnes a year earlier.


November imports of statistical copolymers of propylene (PP random copolymers) increased to 2,000 tonnes from 1,600 tonnes a month earlier due to stronger demand for pipe and injection moulding PP. Total PP random copolymer imports to Ukraine reached 16,200 tonnes in the first eleven months of the year, compared with 15,100 tonnes year on year. Overall imports of other propylene copolymers totalled slightly over 3,200 tonnes over the stated period.

MRC

LyondellBasell appoints Peter Vanacker as its CEO

MOSCOW (MRC) -- LyondellBasell has announced that the Board of Directors has appointed Peter Vanacker, President and CEO of Neste Corporation, as its new Chief Executive Officer, as per the company's press release.

Mr. Vanacker succeeds Bhavesh V. "Bob" Patel, who will retire from the company on December 31, 2021, as previously announced.

Mr. Vanacker will assume his role no later than June 2022, upon satisfaction of the notice period under his current employment agreement, at which time he will also join the company's Board of Directors.

The Board also announced that Kenneth (Ken) Lane, executive vice president, Global Olefins & Polyolefins (O&P) for LyondellBasell, will serve as interim CEO upon Mr. Patel's retirement.

"Peter's outstanding leadership and industry experience made him the Board's choice in an exceptional field of candidates who were considered as part of the comprehensive search process," said Jacques Aigrain, Board Chair. "The Board is confident that his success in delivering value to shareholders, along with his strategic and forward-thinking mindset, will serve the Company well as we continue to drive growth and advance our climate and circularity goals."

Mr. Vanacker brings more than 30 years of industry experience to his new role, including serving as President and CEO of Neste, an industry-leading renewable products company that has seen substantial growth and transformation under his leadership since 2018. Prior to that role, Mr. Vanacker was CEO and Managing Director of the CABB Group, a leader in the fine chemicals global market, and he was CEO and Managing Director of Treofan Group, a global leader in the polypropylene films business. He previously had a succession of roles at Bayer AG, including as EVP and Head of the Global Polyurethanes business and member of the Executive Committee of Bayer Material Science, now Covestro. During his tenure with Bayer, Peter worked across various subsidiaries, including in Belgium, Brazil, Germany and the United States. He is the Chair of the Advisory Board for the European Institute for Industrial Leadership and a member of the Supervisory Board of Symrise AG.

As MRC reported earlier, in July, 2021, Neste and LyondellBasell announced a long-term commercial agreement under which LyondellBasell will source Neste RE, a feedstock from Neste that has been produced from 100% renewable feedstock from bio-based sources, such as waste and residue oils and fats. This feedstock will be processed through the cracker at LyondellBasell’s Wesseling, Germany, plant into polymers and sold under the CirculenRenew brand name.

Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,047,100 tonnes in the first ten months of 2021, up by 17% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,226,530 tonnes in January-October 2021, up by 26% year on year. Supply of propylene homopolymers (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding stat-copolymers of propylene (PP random copolymers) decreased significantly.

Neste (Helsinki) creates solutions for combating climate change and accelerating a shift to a circular economy. The company refines waste, residues and innovative raw materials into renewable fuels and sustainable feedstock for plastics and other materials. The company is the world’s leading producer of renewable diesel and sustainable aviation fuel, developing chemical recycling to combat the plastic waste challenge. In 2020, Neste's revenue stood at EUR11.8 billion, with 94% of the company’s comparable operating profit coming from renewable products.
MRC