Oil extends declines on China growth woes, firmer dollar

Oil prices weakened on Wednesday, extending falls to a third straight day, as the dollar strengthened on a U.S. housing market recovery while fears persisted that monetary stimulus may not be enough to revive growth in China, said Reuters.

Brent futures fell 21 cents, or 0.3%, to USD75.69 a barrel and U.S. West Texas Intermediate (WTI) crude futures were down 14 cents, or 0.2%, at USD71.06 at 0043 GMT. The dollar rose after data showed U.S. homebuilding surged in May to the highest in more than a year and permits for future construction climbed, suggesting the housing market may be recovering after being hammered by Federal Reserve rate hikes.

A firmer dollar weighs on oil demand as it makes the commodity more expensive for buyers holding other currencies. The market remains concerned about a faltering recovery in China, the world's top oil importer. Looking to boost growth, China on Tuesday cut its benchmark loan prime rates (LPR) for the first time in 10 months, with a smaller-than-expected 10-basis-point reduction in the five-year LPR.

The rate reduction followed recent economic data showing the China's retail and factory sectors were struggling to sustain momentum from earlier this year. "Investors remained impatient with China's efforts to boost economic growth," ANZ Research said in a client note on Wednesday. "Beijing's slow stimulus rollout is adding concerns about the weakening economy."

Oil trade was also cautious ahead of congressional testimony by U.S. Federal Reserve Chair Jerome Powell later on Wednesday which is expected to provide clues on future rate moves in the world's biggest economy. Two Federal Reserve policymakers and an economist nominated to join them on the Fed's Washington-based board on Tuesday said their focus is on bringing down too-high inflation so that the U.S. economy can get back to sustainable growth.

We remind, Oil prices fell in choppy trading on Tuesday as a clouded oil demand outlook outweighed the potential boost from a cut to China's benchmark lending rates. Brent crude fell 92 cents, or 1.2%, to USD75.17 a barrel by 1345 GMT. U.S. West Texas Intermediate (WTI) crude for July was down USD1.53 from Friday's close at USD70.25. The July contract expires at the end of trade on Tuesday. The more active WTI crude contract for August delivery was down USD1.51 from Friday at USD70.42 a barrel. There was no WTI settlement on Monday because of a U.S. public holiday.

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Repsol has declared force majeure on supplies of polypropylene (PP) after a technical issue resulted in the shutdown of its PP2 unit in Tarragona, Spain, said Petrochemical-news.

The company has two PP production plants at the site with capacities of 190,000 tonnes/y and 200,000 tonnes/y. The affected unit mainly produces PP copolymer grades. An expected restart date and other details were not given.

We remind, Repsol will nearly double the production capacity of its Reciclex recycled polyolefins with a new production line at its Puertollano Industrial Complex in Spain. The company will invest EUR 26 M to install a new 25,000 tonnes/y production line for polyolefins with mechanically recycled plastic content. Repsol currently has 16,000 tonnes/y of Reciclex polyolefins capacity.

mrc.ru

MAIRE S.p.A. announces that its Integrated E&C Solutions (IE&CS) and Sustainable Technology Solutions (STS) subsidiaries have been awarded new contracts for an overall value of approximately USD260 MM by international clients mainly in Europe, Asia and South America, said Hydrocarbonprocessing.

In particular, KT-Kinetics Technology has been awarded an IE&CS contract for a pre-treatment plant by PKN Orlen (PKN), a Polish multinational oil refiner and petrol retailer, with major operations in Central Europe.

The project shall have a duration of 24 months. The pre-treatment plant, to be installed inside the Plock Refinery in Central Poland, shall process vegetable oils, used cooking oils and animal fats to produce renewable diesel (also known as Hydrotreated Vegetable Oil, or HVO) for the domestic and International markets. NextChem, part of the Sustainable Technology Solutions business unit, will act as technology integrator for the project. The unit will be the first of this kind in Poland and will contribute to the Country’s decarbonization plans, in line with the EU directives.

Alessandro Bernini, MAIRE CEO, commented: “The PKN award is a testament of MAIRE’s expertise in renewable fuels and value creation from second generation feedstock obtained from non-food crops. Thanks to the Group’s integrated approach across its two business units, MAIRE confirms its role as project enabler and technology integrator in the energy transition”.

We remind, Maire Tecnimont S.p.A. (Milan, Italy) announced that its Sustainable Technology Solutions subsidiary NextChem has been awarded a new contract by Storengy to carry out a further advanced basic engineering study for the gasification of the waste wood and the purification system of the syngas to produce biomethane.

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Air Liquide has signed its first long-term power purchase agreement (PPA) with two China Three Gorges Corp subsidiaries for the supply of renewable electricity in China, said the company.

Under the PPA, Air Liquide will purchase a total of 200-megawatt/y of renewable power to be supplied by China Three Gorges Renewables and China Three Gorges Corp Jiangsu branch, beginning in Jan 2024.

The renewable electricity will come from solar and wind farms located in the province of Jiangsu to contribute to the production of industrial and medical gases in China. It will reduce up to 120,000 tonnes/y of carbon dioxide emissions.

We remind, Air Products has signed an investment agreement with the Government of the Republic of Uzbekistan and Uzbekneftegaz JSC (UNG) to acquire, own and operate a natural gas-to-syngas processing facility in Qashqadaryo Province, Uzbekistan for 1 billion dollars. The natural gas-to-syngas industrial complex is an integral part of state-owned energy company Uzbekneftegaz JSC’s multi-billion gas-to-liquid (GTL) facility?one of the most advanced energy plants in the world?producing 1.5 million tonnes per year of high value-add synthetic fuels for domestic use and potentially export.

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MRC) -- PKN Orlen on Wednesday announced a deal potentially worth an estimated zloty (Zl) 18bn (USD4.4bn) to supply fellow Polish state-owned firm Grupa Azoty companies with natural gas, said Reuters.

Orlen and Azoty agreed on a supply contract covering the period running from 1 October this year to the end of September 2026, with an option for a one-year extension, Orlen added.

“The price formula agreed in the new contract is based on the market values ??of gas price indices… the most objective method of pricing, widely used between companies across Europe,” it said in a press release.

The deal will continue the existing commercial arrangement under which oil, gas and petrochemicals group Orlen supplies gas to Azoty, Europe’s second largest fertilizer maker and biggest chemical producer.

More specifically, Orlen will deliver gas to six Grupa Azoty companies, namely Grupa Azoty SA, Grupa Azoty Zaklady Azotowe Pulawy (ZAP), Grupa Azoty Zaklady Chemiczne Police, Grupa Azoty Zaklady Azotowe Kedzierzyn (ZAK), Grupa Azoty Siarkopol and Grupa Azoty Zaklady Fosforowe Gdansk.

We remind, ORLEN Group's PGNiG Upstream Norway has bought interests in two fields on the Norwegian Continental Shelf, said the company. The deal is consistent with the Group's strategic goal of raising its own gas production volumes to improve Poland's energy independence and security. Under an agreement with Sval Energi AS, PGNiG Upstream Norway has purchased a 10% interest in licence PL211 CS, covering the Sabina and Adriana fields.

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