Russia sticking to its oil output cuts says deputy Prime Minister Novak

Deputy Prime Minister Alexander Novak said on Thursday Russia was abiding by its voluntary pledge to cut oil output by 500,000 barrels per day (bpd) from February until the end of the year, said Hydrocarbonprocessing.

Russia is part of the OPEC+ group of oil-producing countries that announced a combined reduction of more than 1 million bpd in April, a surprise decision the United States described as unwise.

"Taking into account the unfounded speculation in the press regarding oil production levels, Russia reaffirms its full commitment to and implementation of voluntary oil production cut levels," Novak said in a statement.

"The target level of voluntary production cuts is 500,000 bpd from the February level until the end of 2023. Monitoring will be carried out according to independent sources."

He also said a two-thirds reduction in Russia's oil pipeline exports to the European Union was only partially compensated by sea-borne exports.

We remind, Russia has become India's largest crude supplier, displacing erstwhile OPEC+ ally Saudi Arabia, with India's April imports from the kingdom dropping to the lowest since September 2021. Russian crude is also winning against Saudi oil in China, with April arrivals of 2.10 million bpd beating out the 1.73 million bpd from the Middle East's top exporter.

mrchub.com

Evonik Industries AG (Essen, Germany) has begun construction of a new production plant for alkoxides in Singapore, said the company.

The mid double-digit million-euro investment will enhance supply security for customers in the region and further strengthen the company’s global alkoxides business.

The company is expanding its production capabilities in response to growing demand for alkoxide catalysts, which are primarily used in biodiesel production and in synthesis applications in the pharmaceutical and agricultural industries. In future, alkoxide catalysts will also play a bigger role in the circular economy through their use in the chemical recycling of PET plastics.

“Asia Pacific is a key region for Evonik Catalysts and Southeast Asia plays an important role in our growth journey,” says Sanjeev Taneja, Senior Vice President and General Manager business line Catalysts adding that this investment once again, underlines Evonik’s commitment to its customer–centric “Think Global – Act Local” approach towards increased customer satisfaction and supply reliability.

The investment is seen as a critical step in Evonik’s strategy to expand its position as one of the largest alkoxide manufacturers in the world. “We already have leading production facilities in Europe, North and South America; Asia is the missing piece in a global supply network to regionally serve all relevant markets,” explains Alexander Weber, Global Head of Product Line Alkoxides.

The new plant will be a modern facility with state-of-the-art technology aiming for zero scope 1 & 2 carbon emissions and it will be located at Evonik’s site on Jurong Island, Singapore. “From this strategic location, we can satisfy the growing demand for alkoxides in this very dynamic region and further boost our position as a reliable catalysts partner,” says Hu Song, Alkoxides Business Director, Asia Pacific, and adds: “With energy-efficient and sustainable production, Evonik contributes to the Sustainable Jurong Island Strategy and supports customers in reducing their carbon footprint."

Following the completion of conceptual and basic engineering, the project is now entering the construction phase, with the alkoxides plant scheduled to become operational by the end of 2024.

Evonik’s global alkoxides supply network and other production sites around the world include Rosario, Argentina; Mobile, USA; and Lulsdorf, Germany.

We remind, Linde has signed a long-term agreement to supply green hydrogen to Evonik. Linde will build, own and operate a nine-megawatt alkaline electrolyzer plant on Jurong Island, Singapore. The plant will produce green hydrogen, which Evonik will use to manufacture methionine, an essential component in animal feed. The new supply agreement supports the planned expansion of Evonik’s existing facility and will help Evonik limit its greenhouse gas emissions in Singapore.

mrchub.com

The strong start to the year for Asia's imports of crude oil came to a halt in April, with arrivals dropping to a seven-month low as top buyers China and India trimmed purchases, said Hydrocarbonprocessing.

A total of 108 million tons, or 26.39 million barrels per day (bpd) was imported by Asia last month, according to data compiled by Refinitiv Oil Research. This was down from March's 27.6 million bpd, which in turn was lower than February's 29.4 million bpd and the 29.13 million bpd in January.

The decline in April arrivals was led by China, the world's largest crude importer, with Refinitiv estimating imports at 10.67 million bpd, down from the 34-month high of 12.37 million bpd in March. It was always likely that China's imports would pull back in April as that month and May are the peak season for refinery maintenance.

But after the strong start to the year for China's crude oil imports, there are now several question marks over the outlook for coming months, as the rebound in the world's second-biggest economy appears uneven. The official manufacturing Purchasing Managers' Index (PMI) dropped to 49.2 in April from 51.9 in March, slipping below the 50-level that demarcates expansion from contraction for the first time since December.

The PMI was also below market expectations for a positive outcome of 51.4. Manufacturing is one of the key pillars of China's economy from a commodity demand perspective, the others being construction and infrastructure.

The news here is somewhat mixed, with infrastructure investment rising 8.8% year-on-year in the first quarter, outpacing a 5.1 rise in overall fixed-asset investment, while property investment fell 5.8%. There is also the question of crude prices and the lag between moves in these and imports, given the time between refiners ordering oil and its delivery can be as long as three months.

Crude oil prices were kicked higher at the start of April when the OPEC+ group of producers surprised the market by announcing an additional 1.16 million bpd of output cuts.

Benchmark Brent futures rose from just below USD80 a barrel to a peak of USD87.49 a barrel on April 12, but have since slipped back to end at USD72.33 on Wednesday as concerns over global growth trumped fears of tighter supply.

Nonetheless, the rise in Brent futures, which was accompanied by higher official selling prices for May cargoes from Middle East exporters such as Saudi Arabia, may put a dampener on Chinese demand for May and June cargoes.

Russia has become India's largest crude supplier, displacing erstwhile OPEC+ ally Saudi Arabia, with India's April imports from the kingdom dropping to the lowest since September 2021. Russian crude is also winning against Saudi oil in China, with April arrivals of 2.10 million bpd beating out the 1.73 million bpd from the Middle East's top exporter.
mrchub.com

Orbia's net income fell 72% year on year to $80m in the first quarter of this year on the back of a slowdown in demand from a very strong prior year period, the Mexican vinyl producer said.

Lower general purpose polyvinyl chloride (PVC) prices and weaker end markets in the context of the current macroeconomic environment were partially offset by strong demand in Connectivity Solutions and improved pricing across the fluorinated solutions product portfolio.

The decrease in EBITDA and EBITDA margin was due to softer demand across certain markets, particularly in Polymer Solutions, Building and Infrastructure, and Precision Agriculture.

The decrease was partially offset by higher profitability in Connectivity Solutions and Fluorinated Solutions.

"The company remains cautious under the current macroeconomic conditions and market uncertainty, including uncertain ongoing impacts of monetary tightening, exchange rate volatility, inflationary challenges and the war in Ukraine," Orbia said in a statement.

Orbia reaffirmed its EBITDA guidance of USD1.65bn or higher for 2023 and "will continue to refine its guidance as the year progresses".

The company also reaffirmed its capital expenditure guidance in the range of USD600m to USD700m for 2023, which includes maintenance spending and growth-related investments.

We remind, Solvay and Orbia recently announced their entry into a joint venture framework agreement to create a partnership for the production of suspension-grade polyvinylidene fluoride (PVDF), creating the largest capacity in North Americam said the company. As it is further stated in a press release, the joint venture will create the largest PVDF production facility for battery materials in the region. The total investment is estimated around 850 million USD, partially funded by a grant to Solvay from the U.S. Department of Energy for a total of 178 million USD.

mrchub.com

Braskem's Q1 main chemicals sales in Brazil fell 15%, year on year, while resin sales were stable, the Brazilian petrochemicals major said.

Braskem puts under the main chemicals umbrella the following: ethylene, propylene, butadiene, cumene, gasoline, benzene, toluene and paraxylene.

Main chemicals sales volume compared with 1Q 2022 decreased 15% due to lower demand in the period, which reflected in the utilisation rate of petrochemical crackers, the company said.

Main chemicals sales volume increased 6% compared to 4Q 2022 with emphasis on gasoline sales, mainly due to higher product availability for sale given the increase in utilisation rate of the petrochemical crackers.

Braskem's Q1 2023 resin sales in Brazil remained stable compared with the same period last year, the Brazilian producer said in its quarterly production and sales report.

Compared with Q4 2022, sales rose by 3% in line with the growth of the Brazilian resin market, due to higher demand for polypropylene (PP) and polyvinyl chloride (PVC), mainly in the agricultural, hospital and construction sectors.

We remind, Brazil’s mines and energy ministry (MME) has requested that federal oil firm Petrobras halt the sale of assets for 90 days starting March 1. The request was made due to the reassessment of the national energy policy and the establishment of a new composition of the national energy policy council (CNPE), which is part of the ministry.

mrchub.com