Crude oil futures in Asia slightly up but increase limited by coronavirus concerns in the region

MOSCOW (MRC) -- Crude oil futures were slightly higher during mid-morning Asian trade May 17, but any upside was limited by concerns over renewed coronavirus-related mobility restrictions in the region, reported S&P Global.

At 11:03 am Singapore time (0303 GMT), the ICE Brent July contract was up 34 cents/b (0.49%) from the May 14 settle at USD69.05/b, while the June NYMEX light sweet crude contract was up 31 cents/b (0.47%) at USD65.68/b.

The market continues to monitor the progress of the COVID-19 pandemic in Asia, where a growing list of countries have tightened mobility restrictions.

Singapore and Taiwan, two countries that have thus far been lauded for reigning in the virus, are among the countries grappling with the rising number of infections. Singapore, on May 14, had introduced new restrictions under what it termed as 'Phase 2 (Heightened Alert)' to stem the recent rise in infections, whereas Taiwan, on May 15, followed suit, raising its coronavirus alert level in the capital, Taipei, and the surrounding city, and imposing two weeks of restrictions.

Meanwhile, over in India, Delhi extended its lockdown until May 24, Chief Minister Arvind Kejriwal said on May 16. Other parts of India, including states such as Maharashtra and West Bengal, have also extended their mobility restrictions, resulting in large swathes of the country currently under some form of lockdown.

Out in the west, fears over the spread of the B.1.167 mutant strain has also dampened market sentiment, even as the UK prepares to take a major step out of its lockdown on May 17. Health Secretary Matt Hancock said that the variant is more transmissible and could soon become the dominant strain in the region, with Prime Minister Boris Johnson also expressing concern over the strain, saying it could thwart the UK's plan to fully unravel all restrictions by June 21.

Market analysts have cautioned that the prospect of a deterioration in the pandemic situation poses significant downside risk for oil prices, but have added that the market remains supported for now by the increase in demand from the US and Europe. They expect the front month Brent marker to trade noisily around the USD69/b level.

As MRC informed earlier, COVID-19 outbreak has led to an unprecedented decline in demand affecting all sections of the Russian economy, which has impacted the demand for petrochemicals in the short-term. However, the pandemic triggered an increase in the demand for polymers in food packaging, and cleaning and hygiene products, according to GlobalData, a leading data and analytics company. With Russian petrochemical companies having the advantage of access to low-cost feedstock, and proximity to demand-rich Asian (primarily China) and European markets for the supply of petrochemical products, these companies appear to be well-positioned to derive full benefits from an improving market environment and global economy post-COVID-19, says GlobalData.

We remind that in December 2020, Sibur, Gazprom Neft, and Uzbekneftegaz agreed to cooperate on potential investments in Uzbekistan including a major expansion of Uzbekneftegaz’s existing Shurtan Gas Chemical Complex (SGCC) and the proposed construction of a new gas chemicals facility. The signed cooperation agreement for the projects includes “the creation of a gas chemical complex using methanol-to-olefins (MTO) technology, and the expansion of the production capacity of the Shurtan Gas Chemical Complex”.

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 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers increased.
MRC

Chevron put out fire at Richmond refinery

MOSCOW (MRC) - Chevron Corp said a fire that broke out at its 245,271 barrel-per-day Richmond, California refinery on Friday morning has been extinguished, reported Reuters.

No injuries were reported, according to the company.

In addition to the refinery fire crew, the Richmond fire department responded to the fire, the company said in a statement, adding the plant also experienced a process unit upset that caused some flaring.

A spokesperson from the Contra Costa Health Services department said it has requested a report on the incident within 72 hours.

“This report will give the refinery a chance to investigate the incident now that emergency conditions have been abated and provide details to our agency so that we can work together to identify root causes and prevent future similar issues,” it said.

As MRC wrote previously, Chevron Corp has restarted the 112,229 barrel-per-day (bpd) Pasadena, Texas, refinery night after completing a multi-unit overhaul that was extended because of the COVID-19 pandemic. The entire refinery was shut from mid-April, 2020, until mid-July, 2020 with the last units returning to production on Tuesday, 14 July. The overhaul was originally to finish in mid-June, but was extended to mid-July.

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 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers increased.

Headquartered in San Ramon, California, Chevron Corporation is the the second-largest integrated energy company in the United States and among the largest corporations in the world. Chevron is involved in upstream activities including exploration and production, downstream activities including refining, marketing and transportation, and advanced energy technology. Chevron is also invested in power generation and gasification processes.
MRC

SEPC to shut cracker for scheduled turnaround on 23 May

MOSCOW (MRC) -- Saudi Ethylene and Polyethylene Company (SEPC), a subsidiary of Tasnee, is planning to start a routine maintenance at its cracker in Jubail on 23 May, 2021, according to CommoPlast with reference to market sources.

The cracker that produces 1 million tons/year of ethylene and 285,000 tons/year of propylene will be shut for a turnaround for about 27 days.

The company also operates a 400,000 tons/year of high density polyethylene (HDPE) and a 400,000 tons/year of low density polyethylene (LDPE) plant at the same site.

As MRC informed before, Saudi Arabia's National Industrialization Company, or Tasnee, had announced a curtailment of feedstock to petrochemical affiliates in varying proportions by an average of 41% due to the attacks on key Saudi Aramco facilities on Saturday, 14 September 2019. Tasnee owns a majority stake in Saudi Polyolefins Company and Saudi Ethylene and Polyethylene Company.

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 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers increased.

SEPC is a joint venture between Tasnee, Sahara Petrochemical Company, and LyondellBasell.
MRC

OQ Chemicals raises May prices for oxo intermediates and polyols

MOSCOW (MRC) -- OQ Chemicals (Monheim am Rhein, Germany) has announced global price increases for several oxo intermediate and polyols products, according to PCE with reference to the company's statement.

Thus, the company will increase prices for the following products effective 13 May, 2021, or as contracts allow: 2-Ethyl Hexanol, n-Butanol, Isobutanol, n-Butyl Acetate, Isobutyl Acetate, n-Propanol, n-Propyl Acetate, Neopentyl Glycol (NPG), Trimethylol Propane (TMP), n-Butyraldehyde, n-Propionaldehyde, and Isobutyraldehyde.

The present price increase is due to unprecedented strong demand and limited availability.

At the same time, details of the specific increases were not provided, with the company asking customers to contact its sales representatives to receive latest prices.

OQ Chemicals has already announced several price increases for its oxo intermediate products this year, citing strong demand and rising raw material costs.

As MRC wrote before, in September 2020, OQ Chemicals entered into an agreement to license its advanced proprietary technology for the production of ethylene and propylene derivatives to Duqm Refinery and Petrochemicals Industries Company (DRPIC) in Oman. DRPIC, a joint venture between Oman Oil Company and Kuwait International Oil Company, is a planned grassroots petrochemical complex at Duqm, Oman. In all, DRPIC awarded twelve license packages to international licensors.

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 576,270 tonnes in the first three month of 2021, up by 4% year on year. Low density polyethylene (LDPE) and high density polyethylene (HDPE) shipments increased. At the same time, PP shipments to the Russian market totalled 410,890 tonnes in January-March 2021, up by 56% year on year. Supply of homopolymer PP and PP block copolymers increased.

OQ Chemicals, formerly Oxea, is a global manufacturer of oxo intermediates and oxo derivatives, such as alcohols, polyols, carboxylic acids, specialty esters, and amines. These products are used for the production of high-quality coatings, lubricants, cosmetics and pharmaceutical products, flavours and fragrances, printing inks and plastics. OQ Chemicals is part of OQ, an integrated energy company that delivers sustainability and business excellence. OQ operates in 16 countries and covers the entire value chain from exploration and production to the marketing and distribution of its products.
MRC

Ukraine made a decision to return the amounts of preliminary special duties on the import of polymers into the country

MOSCOW (MRC) - The Interdepartmental Commission on International Trade (ICMT) of Ukraine has considered the information of the Ministry of Economy of Ukraine on the action of special measures regarding the import of polymer materials to Ukraine, regardless of the country of origin and export, Uryadovy Courier reports.

In accordance with Article 11 of the Law of Ukraine "On the Application of Special Measures Regarding Import to Ukraine", the Commission considered and decided that the following should be returned:

1. The difference between the amount of the preliminary special duty paid at the rate of 18% in accordance with the decisions of 22.05.2020 No. SP-445/2020 / 4411-03 and of 22.06.2020 No. SP-451/2020 / 4411-03, and the amount the final special duty payable at the rate of 12.4% in accordance with the decision of November 20, 2020 No. SP-466/2020 / 4411-03 for suspension polyvinyl chloride, with the Fikentcher constant ranging from 64 to 69, which is classified by code 3904 10 00 00 according to UKTZED regardless of the country of origin and export.

2. The amount of the preliminary special duty paid at the rate of 18% during the period of validity of decisions dated 22.05.2020 No. SP-445/2020 / 4411-03 and dated 22.06.2020 No. SP-451/2020 / 4411-03, on goods, imports which did not harm the national manufacturer, which has such a description "Suspension polyvinyl chloride, with Fikentcher constant up to 63.9 and from 69.1, classified by code 3904 10 00 00 according to UKTZED, regardless of the country of origin and export."

The amounts of the preliminary special duty are subject to return in the presence of a quality certificate drawn up by the manufacturer of the goods or the conclusion of expert institutions in accordance with part three of Article 357 of the Customs Code of Ukraine, confirming the physical and chemical properties of the goods. The decision of the Commission dated April 23, 2021 No. SP-492/2021 / 4411-03 comes into force from the date of publication of this message.

In November last year, it was reported that the Interdepartmental Commission on International Trade (ICMT) of Ukraine changed the import duty on suspension polyvinyl chloride (SPVC) and high-density polyethylene (HDPE). So, based on the results of the meeting, it was decided to extend the special measures of 22 June, 2020 regarding the import of HDPE and PVC with some changes. Special measures are introduced for three years from the date of the duty in the amount of: from the date of application of the duty - 12.4%, 12 months after the application of the duty - 12%, 24 months after the application of the duty - 11.5%. The corresponding decision was made by MKMT on November 20 at the request of Karpatneftekhim LLC (Kalush, Ivano-Frankivsk region). It was noted that the import of these goods to Ukraine from a whole group of African, Asian and a number of island countries, as well as member countries of the European Free Trade Association (EFTA) and the CIS, except Russia, will not be subject to special duty.

According to Market Report's DataScope review, in March import supplies of SPVC to the Ukrainian market decreased to 1,700 tonnes against 2,100 tonnes, European manufacturers further reduced their export sales due to a shortage in the domestic market. At the end of January - March 2021, the total volume of suspension imports reached 6,400 tonnes against 11,500 tonnes a year earlier. Limited export quotas from European and North American producers were the main reason for such a serious drop in imports.
MRC