CADE approves Petrobras refinery sale to UAE investor

MOSOCW (MRC) -- Brazilian antitrust body CADE has approved the sale of refinery RLAM to the UAE's investor Mubadala Investment Company, reported Reuters with reference to a notice in the official gazette.

The deal was announced in March for USD1.65 billion.

RLAM is the first of eight Petrobras refineries on the block to be sold.

As MRC informed before, in December 2020, it became known that Petrobras was seeking 800 million reais (USD152 million) in compensation from engineering group Odebrecht in arbitration proceedings over its alleged violation of the shareholders agreement in petrochemical company Braskem.

We remind that Petrobras may need more than a year to divest its stake in Braskem, said Andrea Almeida, Petrobras CFO, in early July, 2020. She said during the company's recent webinar that Petrobras plans to give more time for potential investors to make offers for the company"s assets, including for its refineries and stakes at its petrochemical and fuel distribution affiliates. The divestment of Petrobras's stake in Braskem in 2020 would be desirable but "might not be possible" as the COVID-19 pandemic has changed market conditions, she said. The company plans to close part of its refinery sales in 2021. In December, Roberto Castello Branco, CEO of Petrobras, said that he wants to sell the company's stake in Braskem within a year. Petrobras owns 32.15% of Braskem.

Headquartered in Rio de Janeiro, Petrobras is an integrated energy firm. Petrobras" activities include exploration, exploitation and production of oil from reservoir wells, shale and other rocks as well as refining, processing, trade and transport of oil and oil products, natural gas and other fluid hydrocarbons, in addition to other energy-related activities.
MRC

MOSCOW (MRC) -- On the back of an acute shortage of European material and high polycarbonate (PC) prices in Asia, imports of PC granules into Russia (excluding shipments from Belarus) decreased in the first four months of 2021 almost by 2 times year on year to 4,400 tonnes, according to MRC's DataScope report.

Imports of material into the country were 8,100 tonnes in January-April 2020. Imports, excluding imports to Belarus, were 990 tonnes last months versus 2,000 tonnes in April 2020. March 2021 imports of PC granules were 1,220 tonnes.

Extrusion grade PC accounted for the reduction in imports. Its share in the total imports of material into the Russian Federation was 22% (990 tonnes) versus 71% (5,800 tonnes) a year earlier. The share of injection moulding grades rose to 67% (3,000 tonnes) in the January-April 2021 versus the share of 23% (1,900 tonnes) a year earlier.
Covestro (with the share of 50%) and Sabic Innovative Plastics (22%) were the main import suppliers of PC granules. Both producers significantly reduced their shipments in 2021. Thus, imports of Covestro's material fell by 27% in the first four months of 2021: from 3,000 tonnes a year earlier to 2,200 tonnes. Sabic's shipments decreased even more - to 970 tonnes (excluding Belarusian imports) from 4,300 tonnes a year earlier.

MRC

1. Crude oil futures drop on large US product inventories

MOSCOW (MRC) -- Crude oil futures slipped during midmorning trade in Asia June 10 on the back of a large build in US product inventories, which cast a shadow of doubt on the optimism surrounding summer driving demand in the region, reported S&P Global. At 10:38 am Singapore time (0238 GMT), the ICE August Brent futures contract was down 65 cents/b (0.90%) from the previous settle at USD71.57/b while the NYMEX July light sweet crude contract was down 61 cents/b (0.87%) at USD69.35/b. The Energy Information Administration reported a 5.2 million-barrel draw in US crude oil inventories in the week ended June 4 amid high refining run rates, but market sentiment was bogged down by a large build of 7 million barrels in gasoline stocks and a 4.4 million-barrel build in distillate inventories over the same period.

2. US PVC exports fall 18.4% YOY in Jan-Apr 2021

MOSCOW (MRC) -- US exports of construction staple polyvinyl chloride (PVC) in the first four months of 2021 were 18.4% lower than in the January-April period of 2020, reflecting fallout from tight supply and strong domestic demand, according to S&P Global with reference to US International Trade Commission data released June 9. The US shipped out 673,664 mt of PVC over January-April 2021, compared to 825,996 mt in the year-ago period, the data showed. April 2020 marked the height of coronavirus pandemic-related shutdowns in the US, which hindered construction activity and prompted sharp production cuts. Upstream chlor-alkali rates plunged to 68% in April 2020 from 90% in March that year, industry statistics show.

MRC

MOSCOW (MRC) -- US exports of construction staple polyvinyl chloride (PVC) in the first four months of 2021 were 18.4% lower than in the January-April period of 2020, reflecting fallout from tight supply and strong domestic demand, according to S&P Global with reference to US International Trade Commission data released June 9.

The US shipped out 673,664 mt of PVC over January-April 2021, compared to 825,996 mt in the year-ago period, the data showed.

April 2020 marked the height of coronavirus pandemic-related shutdowns in the US, which hindered construction activity and prompted sharp production cuts. Upstream chlor-alkali rates plunged to 68% in April 2020 from 90% in March that year, industry statistics show.

In 2021, sustained subfreezing temperatures hit the US Gulf Coast and much of the US in mid-February, forcing widespread weeks-long petrochemical plant shutdowns. February chlor-alkali rates fell to 59% from 82% in January, and then rose to 71% in March and 80% in April, industry statistics show.

In the first four months of 2019, when there were no pandemic-related or freeze-related issues, the US exported more than 1 million mt of PVC, ITC data show. Exports in the January-April period of 2021 were 34.5% lower, illustrating the continued impact of the February freeze as well as turnarounds and operational issues that have kept US PVC supply tight.

Strong domestic PVC demand also shrinks export volume availability. In addition, domestic PVC demand has remained strong amid a continued housing boom fueled by consumers seeking more space when working from home amid the pandemic.

April 2021 housing starts reached 1.569 million units, according to US Census Bureau data. The year began with 1.625 million units in January, which plunged nearly 11% to 1.447 million units in February because of the freeze. Housing starts jumped 22.5% to 1.733 million units in March, reflecting a catch-up from starts hindered the month prior and retreated 11.5% in April.

PVC is used to make pipes, window frames, vinyl siding and other products.

As MRC reported earlier, Formosa Plastics USA, part of Formosa Petrochemical, left force majeure (FM) on PVC supplies from its plants in North America in force as of 2 June, 2021. And OxyChem, the chemical division of Occidental Petroleum, left FM on PVC shipments from its plants in North America in force as of 2 June, 2021.

According to MR''s ScanPlast report, Russia's overall PVC production reached 346,100 tonnes in the first four months of 2021, down 1% year on year. All producers decreased production volumes over the reported period, with the exception of the Bashkir Soda Company.
MRC

MOSCOW (MRC) -- Crude oil futures slipped during midmorning trade in Asia June 10 on the back of a large build in US product inventories, which cast a shadow of doubt on the optimism surrounding summer driving demand in the region, reported S&P Global.

At 10:38 am Singapore time (0238 GMT), the ICE August Brent futures contract was down 65 cents/b (0.90%) from the previous settle at USD71.57/b while the NYMEX July light sweet crude contract was down 61 cents/b (0.87%) at USD69.35/b.

The Energy Information Administration reported a 5.2 million-barrel draw in US crude oil inventories in the week ended June 4 amid high refining run rates, but market sentiment was bogged down by a large build of 7 million barrels in gasoline stocks and a 4.4 million-barrel build in distillate inventories over the same period.

week ended May 28, US gasoline inventories had risen 1.5 million barrels while distillate inventories increased by 3.7 million barrels, according to EIA data.

"Refiners are pumping out a lot of fuel, operating at 91.3% of their operable capacity. The pickup in crude demand has been solid over the past month, but this week showed a little dip," said Edward Moya, senior market analyst at OANDA, in a June 10 note. "The headline draw of 5.2 million barrels, greater than the expected decline of 2.9 million barrels, but everyone seemed to focus on the surprising massive builds with gasoline and distillate inventories."

The build in gasoline inventories reflected that bullish market expectations after the Memorial Day weekend - typically signaling the start of summer driving season - did not materialize.

However, analysts said the long-term outlook for crude oil remains supported by strengthening fundamentals as economies across the world embark on a rocky path toward a vaccine-led demand recovery.

"Green shoots are emerging in some of the Covid-19 ravage(d) countries as indicated by better economic activity and availability of vaccines," said Avtar Sandu, senior commodities manager at Phillips Futures, in a June 10 note.

As MRC informed earlier, Indian refiners, anticipating a lifting of US sanctions, plan to make space for the resumption of Iranian imports by reducing spot crude oil purchases in the second half of the year. The world"s third-largest oil consumer and importer halted imports from Tehran in 2019 after former US President Donald Trump withdrew from a 2015 accord and re-imposed sanctions on the OPEC producer over its disputed nuclear programme.

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 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.
MRC