Shell warns of further chemical losses in Q3

Shell PLC expects to post a third-quarter loss for its chemicals business, the company said in an update Oct. 7. It will be the chemical business’s fifth consecutive quarterly loss, as per Chemweek.

The business reported an adjusted loss of USD192 million in the second quarter.

Shell also anticipates that its third-quarter indicative chemicals margin will decline to USD160 per metric ton from USD166 per metric ton in the second quarter.

However, Shell expects that its average chemical plant operating rate will recover to 79%-83% in the third quarter from 72% in the previous quarter. The company’s chemical plant utilization had been driven down in the second quarter by planned and unplanned maintenance outages, mainly at the company’s Monaca, Pennsylvania, ethane cracker.

Shell is scheduled to publish its full third-quarter results on Oct. 30.

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Dow Inc. is assessing the impact of a fire that struck a polyethylene unit at Plant B of the company’s Freeport, Texas, facility, on Oct. 6, as per Chemweek.

The fire began at 7:15 pm local time on Oct. 6 and was extinguished at 2:30 am Oct. 7. No injuries were reported.

”We will begin site and product impact assessments today and continue to communicate with our stakeholders quickly and transparently,” Dow said in an official statement on Oct. 7.

Dow has four polyethylene units at Freeport totaling 914,000 metric tons per year of production capacity, according to data from Commodity Insights. Two units produce linear low-density polyethylene, one produces high-density polyethylene, and one produces low-density polyethylene. Dow did not specify which unit was affected.

The Freeport facility is Dow’s largest integrated site, with more than 40 production plants. It accounts for 44% of Dow’s products sold in the US and more than 21% of the company’s exports, according to the company’s website.

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Despite the rise in upstream energy values, propylene prices remained stable in Asia on Monday, supported by quiet buying sentiment across the region, as per Polymerupdate.

On Monday, FOB Korea propylene prices were assessed at the USD 745-755/mt levels, steady from Friday's assessed levels.

Meanwhile, CFR China propylene prices on Monday were assessed at the USD 780-790/mt levels, unchanged from Friday.

In plant news, Hyundai Chemical is likely to shut down its cracker by mid-October 2025 for a maintenance turnaround. The unit is expected to remain offline for around 50 days. Confirmation from an authorized source could not be obtained. Located in Daesan, South Korea, the cracker has a propylene production capacity of 500,000 mt/year.

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The combined quota of the OPEC+ countries for November, including compensations by those who broke the arrangement, will total 38.084 million barrels per day (b/d), up 74,000 b/d on October, according to estimates by Interfax based on the latest OPEC data, as per Interfax.

On Sunday the eight members of the alliance which voluntarily restricted their outputs by 1.65 million b/d approved a resolution to increase production by an aggregate 137,000 b/d from next month. However, the increase will be more restrained due to the compensatory schedules for the overproduction in previous months, primarily by Kazakhstan which is to cut its output by 86,000 b/d in November.

Three participants in the deal - Saudi Arabia, Kuwait and Algeria - will be able to produce at the level of the quotas set at 10.061 million b/d, 2.569 million b/d and 967,000 b/d, respectively. The other five will have to cut their targets by a certain volume of compensations, depending on the extent of the surpluses they allowed to occur in previous months.

According to the current quotas and compensation schedules, next month oil production plans will increase to 9.498 million b/d in Russia, 4.107 million b/d in Iraq, 3.377 million b/d in the United Arab Emirates, 2.569 million b/d in Kuwait and 802,000 b/d in Oman. Kazakhstan is to bring output down to 1.477 million b/d.

That means that from next month Russia and Saudi Arabia can each increase their outputs by 41,000 b/d, the UAE by 22,000 b/d, Iraq by 18,000 b/d, Kuwait by 10,000 b/d, Oman by 6,000 b/d and Algeria by 4,000 b/d.

Kazakhstan is the only one to have to reduce production, by 58,000 b/d.

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Eight OPEC+ countries have decided to increase their production quotas in November by 137,000 barrels per day due to a stable global economic forecast and favorable market conditions currently reflected in low oil reserves, the Organization of the Petroleum Exporting Countries said in a statement, as per Interfax.

The next meeting of the ministers is due on November 2.

The decision was made due to stable prospects for the world economy and favorable market conditions expressed in low oil reserves, the statement said.

In future the 1.65 million b/d limits could be restored partly or in full, depending on the market situation, it said.

Considering the compensation schedules for some members of the alliance the combined OPEC+ quota for production in November will increase by 74,000 b/d to 38.084 million b/d.

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