Crude oil prices rise on lower US oil inventories and concerns that rising coronavirus cases might reduce demand

MOSCOW (MRC) -- Oil prices rose on Wednesday, after government data showed US crude and fuel inventories fell last week, offsetting concerns that rising coronavirus cases might reduce demand, reported Reuters.

Brent crude rose 29 cents to settle at USD79.23 a barrel. US West Texas Intermediate (WTI) crude rose 58 cents to settle at USD76.56 a barrel.

In the United States, the average number of daily confirmed coronavirus cases hit a record high of 258,312 over the last seven days, a Reuters tally on Wednesday found. read more

Both oil futures contracts earlier traded at their highest in a month after US government data showed lower oil inventories.

Crude inventories fell by 3.6 million barrels in the last week to 420 million barrels, compared with analysts' expectations in a Reuters poll for a 3.1 million-barrel drop.

US gasoline stocks fell by 1.5 million barrels over the same period to 222.66 million barrels, compared with analysts' expectations in a Reuters poll for a 0.5 million-barrel rise.

Distillate stockpiles fell by 1.7 million barrels to 122.43 million barrels, versus expectations for a 0.2 million-barrel rise, the EIA data showed.

Oil prices have been underpinned by Ecuador, Libya and Nigeria declaring forces majeures this month on part of their oil production because of maintenance issues and oilfield shutdowns.

Russian Deputy Prime Minister Alexander Novak said that the OPEC+ group of producers has resisted calls from Washington to boost output because it wants to provide the market with clear guidance and not deviate from policy on gradual increases to productions.

Investors are awaiting an OPEC+ meeting on Jan. 4, when the alliance will decide whether to proceed with a planned production increase of 400,000 barrels per day in February.

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

MOSCOW (MRC) - Nizhnekamskneftekhim (NKNH, part of SIBUR Holding) held an extraordinary meeting of shareholders of PJSC "Nizhnekamskneftekhim" on December 27, at which shareholders elected members of the Board of Directors in a new composition, said the company.

According to the decision of the Board of Directors, Mikhail Karisalov was elected Chairman of the Board of Directors of PJSC Nizhnekamskneftekhim, Airat Safin - Deputy Chairman of the Board of Directors of PJSC Nizhnekamskneftekhim.

SIBUR completed the purchase of TAIF in October 2021 and continues to merge the oil and gas chemical businesses of the companies.

Nizhnekamskneftekhim's revenue for nine months of 2021 amounted to Rb181.8 bn. - against Rb102.4 bn in the same period last year, which is 77.5% more. Gross profit more than doubled to Rb52 bn, which is Rb 27.5 bn more than in the nine months of 2020 (Rb24.5 bn).

Profit from sales for nine months increased to 38.1 bn rubles. - against 13.3 bn in 2020. Net profit increased to a record 33.6 bn rubles, in the pandemic year 2020 for nine months the company suffered a loss of 2.3 bn rubles.

The enterprise is carrying out technical re-equipment of the production of halobutyl rubbers up to 200 thousand tons per year, construction of the production of ethylbenzene and styrene with a capacity of 250 thousand tons per year, polypropylene 400 thousand tons per year and polystyrene with a capacity of 250 thousand tons per year.
MRC

MOSCOW (MRC) - The new board of directors of Kazanorgsintez includes seven representatives of SIBUR, Realnoe Vremya reports.

In total, the shareholders elected ten people.

On behalf of SIBUR, the Board of Directors of Kazanorgsintez includes: Igor Klimov, Managing Director for Production Efficiency at SIBUR; Sergey Komyshan, Executive Director for Marketing and Sales of SIBUR; Pavel Lyakhovich, Managing Director of the Basic Polymers Directorate of SIBUR; Marina Medvedeva, Managing Director for Business Processes at SIBUR; Alexey Shakhov, Director of Government Relations, SIBUR Holding; General Director of TAIF Ruslan Shigabutdinov; General Director of Kazanorgsintez Farid Minigulov.

In addition to them, the following were elected to the new board of directors of Kazanorgsintez: Sergei Alekseev, First Deputy General Director of Svyazinvestneftekhim JSC; Assistant to the President of Tatarstan Renat Galiev;
Minister of Economy of Tatarstan Midkhat Shagiakhmetov.

In October, SIBUR closed the deal to acquire 100% of TAIF JSC, which includes Nizhnekamskneftekhim, Kazanorgsintez and TGK-16.

Earlier it was reported that Kazanorgsintez (TAIF Group) in 2022 will complete the modernization of equipment for the production of polycarbonates, which will allow reaching the design capacity of 100,000 tonnes per year.

According to MRC's ScanPlast, the total consumption of PC granulate in Russia in January-October 2021 (excluding imports and exports to Belarus) decreased by 15% and amounted to 67,300 tonnes against 79,500 tonnes in the same period a year earlier.

PJSC Kazanorgsintez is one of the largest enterprises in the Russian Federation (PJSC TAIF Group of Companies). It produces 40% of all Russian polyethylene and is its largest exporter. Currently, PE, polycarbonate (PC), polyethylene pipes, phenol, acetone, bisphenol A are produced. KOS is the only Russian PC manufacturer. There are 170 types of products in total.
MRC

MOSCOW (MRC) - Biaxplen (part of SIBUR Holding) discussed the results of the year with clients, the company said in a statement.

During the meeting, the following topics were discussed: the state of the BOPP market in 2021 and the forecast of its development in 2022, the current state and future of customer service, the results of a customer satisfaction survey, changes in the company's trade policy and logistics, innovations in packaging, and much more. The meeting was attended by representatives of more than 30 companies of Biaxplen's clients and partners from Russia and the CIS countries.

The first part of the round table was devoted to changes in the polymer market and the forecast of its development. Georgy Martirosyan, Senior Marketing Manager of the Basic Polymers Directorate of SIBUR, in his speech described the change in the situation on the Russian FMCG product sales market over the past 3 years: a 4-fold increase in the share of discounters, a simplification of assortment and structures in flexible packaging, an increase in e-com sales in 2 times under the influence of a pandemic.

The main trends that will affect the packaging industry in the coming years are the demand for packaged products, a decrease in the costs of manufacturing packaging and supplying goods, the popularity of reusable packaging solutions, lighter portion packaging, the rapid growth of on-line trade and delivery, the preference for recyclable and recycled packaging solutions, increasing consumption of flexible packaging in the world.

Earlier it was reported that Biaxplen upgraded the extrusion lines produced by the German Bruckner, designed for the production of biaxially oriented films (BOPP films).

Earlier it was reported that in July Biaxplen developed a metallized film of the HBV.M brand, which has high barrier properties. The new brand will be produced at the Kursk plant Biaxplena. The production capacity will be 500 tons per year. The production launch of the film is scheduled for the second half of 2021.

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 1,868,160 tonnes in the first nine months of 2021, up by 18% year on year. Shipments of all grades of ethylene polymers increased. At the same time, PP shipments to the Russian market were 1,138,510 tonnes in January-September 2021, up by 30% year on year. Supply of propylene homopolymer (homopolymer PP) and block-copolymers of propylene (PP block copolymers) increased, whereas supply of injection moulding statistical copolymers of propylene (PP random copolymers) decreased significantly.

All five Biaxplen factories are certified according to the quality management system ISO 9001. The group's total BOPP film production capacity is over 160 thousand tons per year. The company is actively developing export supplies of films to the EU market.

Biaxplen is a subsidiary of the SIBUR petrochemical holding, the leader of BOPP in Russia. Production capacity - 180 thousand tons per year, 8 high-speed lines. Brand assortment - over 40 types. Production sites are located in five regions. The products are exported to 27 countries.
MRC

MOSCOW (MRC) -- Polypropylene (PP) imports into Russia rose in the first eleven month of 2021 by 12% year on year to 227,600 tonnes. Propylene copolymers accounted for the main increase in imports, according to MRC's DataScope report.

Russian companies reduced their PP purchases last month, imports were 17,500 tonnes versus 22,000 tonnes in October, imports of all grades of propylene polymers decreased. Thus, overall PP imports into Russia reached 227,600 tonnes in January-November 2021, compared to 202,700 tonnes a year earlier. Procurement of all grades of propylene copolymers in foreign markets increased, whereas imports of propylene homopolymers (homopolymer PP) decreased.

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

November imports of homopolymer PP were slightly less than 6,000 tonnes versus 8,500 tonnes a month earlier, shipments from Azerbaijan and Turkmenistan fell significantly. Thus, overall imports of homopolymer PP totalled 83,400 tonnes in the first eleven months of 2021, compared to 85,400 tonnes a year earlier.

Last month's imports of propylene block-copolymers (PP block copolymers) were 6,400 tonnes versus 7,200 tonnes in October, demand for Asian PP subsided from Russian companies. Imports of PP block copolymers into Russia reached 69,800 tonnes over the stated period, compared to 53,800 tonnes a year earlier.

November imports of stat-copolymers of propylene (PP random copolymers) dropped to 1,800 tonnes from 3,100 tonnes a month earlier, with injection moulding and pipe grade products manufactures accounting for the main reduction in shipments. Overall imports of this grade of propylene copolymers were 37,200 tonnes in January-November 2021, compared to 33,200 tonnes a year earlier.

Imports of other propylene polymers totalled 37,100 tonnes over the stated period versus 30,300 tonnes a year earlier.

MRC