Cruide oil prices continue sliding towards three-month lows as the Delta variant spreads

MOSCOW (MRC) -- Oil prices fell for a seventh straight session on Friday towards three-month lows as investors became less bullish about fuel demand due to a surge in cases of the COVID-19 Delta variant that is hitting travel, reported Reuters.

Brent crude fell USD1.03, or 1.6%, to USD65.42 a barrel by 11:55 a.m. EDT (1555 GMT), near its lowest since May and down about 7% for the week.

US West Texas Intermediate (WTI) crude for September, due to expire on Friday, fell USD1.07, or 1.7%, to USD62.62 a barrel and was down almost 8% for the week.

China, the world's largest crude importer, has imposed new restrictions with its "zero tolerance" coronavirus policy which is affecting shipping and global supply chains. The United States and China have also imposed tit-for-tat flight capacity restrictions.

"They are acting severely for minimal outbreaks which is a direct threat for the demand profile there," said John Kilduff, partner at Again Capital LLC in New York.

Several US firms, meanwhile, have delayed return-to-office plans as Delta cases spike and countries across Asia are reimposing lockdowns.

The US dollar hit a nine-month high on signs the US Federal Reserve is considering reducing stimulus this year. Oil prices move inversely to the US currency, making oil more expensive for foreign purchasers when the dollar rallies.

Oil demand could also fall as the period of peak US gasoline demand nears its end and European summer holidays come to a close.

Lockdowns in other in major economies around the world have likely harmed the economic activities and growth forecasts in the months to come, said Margaret Yang, a strategist at Singapore-based DailyFX.

As MRC informed previously, crude oil stockpiles fell modestly in early August, while gasoline inventories dipped to their lowest level since November, according to the US Energy Information Administration. Crude inventories fell by 447,000 barrels in the week to Aug. 6 to 438.8 million barrels, compared with analysts' expectations in a Reuters poll for a 1.3 million-barrel drop. Overall crude inventories have been on the decline for several weeks due to increased demand.

We remind that US crude oil production is expected to fall by 160,000 barrels per day (bpd) in 2021 to 11.12 million bpd, the US Energy Information Administration (EIA) said in a monthly report, a smaller decline than its previous forecast for a drop of 210,000 bpd.
MRC

MOSCOW (MRC) -- Evonik has reinforced its emission management leadership position in the polyurethanes industry with a new best-in-class spray foam emissions testing facility at its laboratories in Allentown, Pennsylvania, as per the company's press release.

With its innovation focus on zero-emission and more environmentally preferred additive solutions, this latest milestone further demonstrates Evonik’s commitment to supporting the Spray Polyurethane Foam (SPF) industry to meet its sustainability targets and maintain growth.

As a green product with excellent thermo-insulation properties, buildings constructed with SPF using Evonik additives can significantly reduce energy consumption and lower the carbon footprint. With as much as 40% of a building’s energy loss due to air leaks in roofs and walls, in addition to its excellent thermal performance, SPF also helps to seal gaps preventing air leakage.

As the American Chemistry Council’s Spray Foam Coalition states: up to 33 billion US dollars in energy costs could be saved each year, if the 113 million family homes in the United States each used SPF insulation. SPF is more effective than alternative insulation materials such as fiberglass or mineral wool, which has helped the polyurethane foam-based industry in North America experience double digit growth over recent years.

Emission testing has become much more sophisticated with stricter environmental and worker safety regulations. In addition to the environmental benefits of reduced greenhouse gases, low or zero emission products are now an industry requirement to reduce worker re-entry and building re-occupancy times after spraying. The new emissions testing facility will help Evonik’s customers to establish formal measurement and testing protocols to meet current environmental, and future emissions and American Society for Testing Materials (ASTM) standards.

The new testing facility was commissioned and approved by the Spray Foam Coalition, an organization of companies that produce and sell polyurethane spray foam insulation systems, chemicals and equipment. Another key feature of Evonik’s new testing facility is the cold chamber which enables extremely low temperature spray tests down to 0-degree F for cold weather adhesion testing. These harshest low temperature tests make it possible to mimic real world conditions during any time of the year, helping to speed up formulation development time and improve product performance.

As a leader in supporting each blowing agent transition, Evonik’s solutions for the latest HFO blowing agents have helped to significantly reduce the spray foam industry’s global warming footprint relative to the previous HFC blowing agents. These are typically used in polyurethane foam applications that require high insulation properties such as spray foam insulation, refrigerator/freezer insulation, and panel insulation for building structures.

As MRC informed earlier, in February, 2020, Dow and Evonik entered into an exclusive technology partnership. Together, they plan to bring a unique method for directly synthesizing propylene glycol (PG) from propylene and hydrogen peroxide to market maturity.

Propylene is the main feedstock for the production of polypropylene (PP).

According to MRC's ScanPlast report, PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.

Evonik is one of the world leaders in specialty chemicals. The focus on more specialty businesses, customer-oriented innovative prowess and a trustful and performance-oriented corporate culture form the heart of Evonik’s corporate strategy. They are the lever for profitable growth and a sustained increase in the value of the company. Evonik benefits specifically from its customer proximity and leading market positions. Evonik is active in over 100 countries around the world with more than 33,000 employees.
MRC

MOSCOW (MRC) - Khabarovsk Pipe Insulation Plant (KhTZI) announced the expansion of its product line and entering new sales markets, the company said.

This year the plant has launched the production of pipes with foam insulation. "This technology is used in the West, in the central part of Russia. We decided to try our hand here, in the Far East, and we succeeded. We bought equipment, we made some of the tooling required for production ourselves. This year we have already won two tenders for the supply new products ", - said the general director of KhZTI Andrey Bobrov.

By the end of the year, the enterprise also plans to launch production of corrugated pipes used in electrical work. For this, an extrusion production line from China was purchased and installed, on which test samples of products have already been made.

The company's message says that the sales market for the plant's products covers almost the entire Far East. Over the entire period of work, according to the head, about 1 thousand km of pipes for heating networks and about the same amount of removable thermal insulation made of polyurethane foam (PPU) were supplied to customers.

"Unfortunately, today there are not so many orders compared to previous years. The main reason is that there has been a very serious increase in prices for raw materials and materials. Nevertheless, we expect that the situation will change soon. it is planned to build a plant for the production of liquefied gas in De-Kastri, and the Ministry of Industry of the Khabarovsk Territory assisted us to be included in the register of potential suppliers for such a large project, " - said Andrei Bobrov.

Earlier it was reported that in January 2020 Timashevsky Pipe Insulation Plant LLC, registered in Krasnodar, acquired the property complex of Pipe Insulation Plant LLC, registered in Timashevsk.

According to the ICIS-MRC Price Report, there is still a shortage of supply on the domestic market of expandable polystyrene in Russia, and the demand for the material is high. Russian manufacturers have significantly increased the price of their material this month. The spot price of EPS produced by Sibur-Khimprom and Plastik (Uzlovaya) in August was agreed at the level of Rb185,000-195,000/tonne, CPT Moscow, including VAT.

Khabarovsk Pipe Insulation Plant (KhZTI) has been operating since 2014, and today the company's production area occupies about 5 thousand square meters. The plant specializes in the production of thermal insulation for networks, removable thermal insulation in the form of polyurethane foam pipes and pre-insulated pipes of two categories, as well as in the production of pipes and fittings in polyurethane foam insulation.
MRC

MOSCOW (MRC) - NPP POLYPLASTIC, the largest Russian manufacturer of thermoplastic composite materials, plans to commission two compounding lines in Engels this year, the company said.

Investments in equipment amounted to EUR3.3 mn euros (Rb286 mn). After reaching the design capacity by 2022, these lines will produce 20,000 tonnes of material per year in addition to the volume that is already being produced today, and in 2023 it is planned to build a plant in the Special Economic Zone (SEZ) of the Volga region.

The report notes that in August 2021, NPP POLYPLASTIC celebrates its 30th anniversary. The company has produced 2 mn tonnes of thermoplastic compounds in three decades.

Earlier it was reported that RPC "POLYPLASTIC" plans to increase the volume of exports several times in the near future.

NPP "POLYPLASTIC" plans to modernize 50% of production lines by 2025 in terms of automation of the control system and traceability of production process data.

NPP "POLYPLASTIC" produces more than 250 grades of polymer compounds, providing localization of plastic materials in such industries as the automotive industry, household and electrical engineering, cable and construction industries. The company supplies materials for the manufacture of plastic auto components for models of leading car manufacturers: AvtoVAZ, UAZ, GAZ, Volkswagen, Hyundai, Skoda, Kia, and others. Global brands-manufacturers of white household appliances - Indesit, B / S / H, LG, BEKO - are also partners of the Russian compounder.
MRC

MOSCOW (MRC) -- Marathon Petroleum Corp and Archer-Daniels-Midland Co announced a joint venture to produce soybean oil that will be exclusively sold to Marathon as a renewable diesel feedstock, according to Hydrocarbonprocessing.

Refiners are on the hunt for secure access to feedstocks for renewable fuels amid supply constraints and soaring prices for fats, greases and oils.

The JV soybean processing complex in Spiritwood, North Dakota, is expected to produce about 600 million pounds of refined soybean oil annually, enough feedstock for about 75 million gallons of renewable diesel per year when complete in 2023, the companies said.

That is approximately 40% of the feedstock needed to supply Marathon's nearby Dickinson, North Dakota, plant, which can process about 180 million gallons of renewable diesel annually.

Marathon also plans to convert its idled Martinez, California refinery to produce 730 million gallons per year of renewable fuels, one of a number of refiners ramping up green fuel production.

The project creates a domestic buyer for the state's export-dependent soybean producers, who saw demand from top buyer China, evaporate during the US-China trade war.

ADM executive Ken Campbell said he believes renewable diesel demand may be as much as 5 billion gallons by 2025.

But Marathon told investors last quarter that soybean oil's economics were "challenged" because higher prices coupled with the relatively higher carbon intensity of the oil limits refiners' ability to profit on production.

The JV will be majority-owned by ADM with a 75% stake, while Marathon Petroleum will own the rest.

As MRC reported earlier, Marathon Petroleum, the largest US refiner, is "hopeful" that the US refining sector will recover as demand for gasoline and diesel picks up, but remains cautious about the impact of the spreading delta variant of the coronavirus.

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 1,176,860 tonnes in the first half of 2021, up by 5% year on year. Shipments of exclusively low density polyethylene (LDPE) decreased. At the same time, PP shipments to the Russian market were 727,160 tonnes in the first six months of 2021, up by 31% year on year. Supply of homopolymer PP and block-copolymers of propylene (PP block copolymers) increased. Supply of statistical copolymers of propylene (PP random copolymers) subsided.

Marathon Petroleum Corporation (MPC) is a leading, integrated, downstream energy company headquartered in Findlay, Ohio. The company operates the nation's largest refining system. MPC's marketing system includes branded locations across the United States, including Marathon brand retail outlets.
MRC