Saudi oil demand boom may squeeze global supply

(Arabian Oil and Gas) -- Saudi Arabia is commonly regarded as the world's swing producer of oil, with proven crude reserves of 264.5 billion barrels and production of around 9.7 million barrels of oil per day (bpd). However, a report in the Financial Times says the Kingdom's burgeoning domestic demand for oil, especially for electricity generation, may seriously restrict it's ability to continue to stabilise prices by increasing exports.

Saudi is already the world's sixth largest oil consumer, with domestic oil demand rocketing by 75% in the ten years to 2011. Domestic oil consumption is slated to rise by 5.6% this year from it's current rate of 2.81 million bpd.

Power generation in Saudi is particularly oil-intensicve as plants typically burn heavy crude, rather than refined oil.

Saudi is starting to expand it's gas exploitation, with Karan, the Kingdom's first non-associated gas field, beginning production now. However, oil looks set to remain the core energy source for electricity generation for several years.


European PE export prices for FSU markets to rise

MOSCOW (MRC) -- This week some European producers have declared growth of polyethylene (PE) export prices for FSU markets, due to rising prices of PE in the Asian market, high oil prices and the coming maintenance shutdowns, according to ICIS-MRC Price report.

Cheap imports from Asia and the Middle East has forced European producers to decrease significantly PE prices for the domestic market in June - July. Two months later after May peak, contract PE prices fell by EUR 120-140/t. A similar price decline also affected the export prices in FSU markets, which were reduced in the first half of July by some producers to EUR 1.050 - 1.120 / t, FCA for LDPE, and EUR 1.020 - 1.100 / t, FCA for HDPE.

In July, Asian markets showed increasing PE demand which along with growing oil prices led to increasing prices of polyethylene. Over the three weeks of July, PE prices in Asia rose by USD 50-80 / t. Growing polyethylene prices in the Asian market made some European producers change their pricing policies. Increasing price trend is also strengthened by the coming maintenance shutdowns of plants in the Eastern Europe, weakening rate of euro against dollar and high oil prices.

As a result, this week some producers from Eastern Europe have raised their export prices of polyethylene. Rising prices of LDPE and HDPE in the second half of July are within the range of EUR 20-80/t.


Oil prices were mixed in Asian trade

(ABS-CBNNews) -- Oil prices were mixed in Asian trade Monday as news of European banks passing closely-watched stress tests counteracted concerns over the US government's debt problems, analysts said. New York's main contract, light sweet crude for delivery in August, fell nine cents to USD 97.15 per barrel. Brent North Sea crude for September delivery was up 22 cents to USD 117.48.

"Oil is sort of holding steady, it's really pulled in all different directions," said Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore.

"On the one hand, the news late last week that most European banks have passed the stress tests... has supported crude futures," he told AFP.

The European Union's banking regulator the European Banking Authority on Friday announced that only eight of 91 banks had failed stress tests, a better than expected result amid the region's escalating debt woes.

Crude traders had been awaiting the results of the tests to gauge the impact of the eurozone's broadening debt crisis, which could potentially cut into European energy demand.

However, persistent worries of a political impasse in the United States over its debt crisis continued to hang over crude prices, Shum said.


White Martin signed a gas supply contract with Braskem

(Plastemart) -- Praxair Inc.'s Brazilian arm-White Martin, recently signed a gas supply contract with Braskem, the largest petrochemical company in the Americas and the world's largest biopolymers producer. The 15-year agreement requires White Martin to supply nitrogen and oxygen to Braskem's expanded polyvinyl chloride (PVC) unit in the state of Alagoas, in Brazil's northeast region. The company will construct a new cryogenic on-site air separation plant with a daily capacity of 200 tons.

The project, with an estimated value of USВ 635 mln, is Braskem's single largest investment in Brazil. Operations at the new industrial unit are likely to start by the H1-2012.


Foster Wheeler subsidiary inks MOU to form jointly-owned company with SOCAR

(Plastemart) -- Foster Wheeler AG subsidiary of its Global Engineering and Construction Group has signed a Memorandum of Understanding (MoU) to cooperate to form a jointly-owned company with The State Oil Company of Azerbaijan Republic (SOCAR) in the Republic of Azerbaijan. The new jointly-owned company will focus on providing process, engineering, procurement, construction supervision and project management services associated with the development of the new oil, gas processing and petrochemical complex. The new entity will provide the same services for upstream, midstream and downstream oil and gas projects developed by SOCAR both in the Republic of Azerbaijan and in other countries.

In line with the principles outlined in the MoU, Foster Wheeler and SOCAR will prepare a joint action plan for the establishment and incorporation of the new company, with its headquarters in Baku.