Friday, March 6, 2020
Energy, Petrochemicals and Plastics 54
1 Russian resistance hammers oil prices, pushing OPEC to the brink
http://www.worldoil.com/news/2020/3/6/russian-resistance-hammers-oil-prices-pushing-opec-to-the-brink
Ministers from the Organization of Petroleum Exporting Countries told Russia on Thursday that if it doesn’t join them in cutting oil output by another 1.5 million barrels a day to offset the impact of the coronavirus, then the cartel could abandon its reductions altogether. Hours later, the group raised pressure on Moscow again, emerging from an informal meeting at the Saudi delegation’s hotel with a proposal to extend the curbs for even longer than initially suggested.
2 OPEC Presents Russia With Production Cut Ultimatum
https://oilprice.com/Energy/Energy-General/OPEC-Presents-Russia-With-Production-Cut-Ultimatum.html
On Thursday, OPEC met in Vienna and announced a proposed 1.5 million barrels per day (mb/d) of additional cuts. The idea calls for OPEC itself cutting by 1 mb/d, and the non-OPEC coalition reducing output by 0.5 mb/d. However, as of Thursday, Moscow had not signed onto the agreement.
3 Oil Price Fundamental Daily Forecast
https://www.fxempire.com/forecasts/article/oil-price-fundamental-daily-forecast-look-for-opec-compromise-that-falls-short-of-demand-losses-637262
U.S. West Texas Intermediate and international-benchmark crude oil futures are down nearly 2% on Friday as concerns over global oil demand and economic growth caused by the coronavirus epidemic were heightened by worries over non-OPEC crude producers’ delay in agreeing to further production cuts designed to trim oil supply and stabilize prices.
At 08:48 GMT, April WTI crude oil is trading $45.14, down $0.76 or -1.66% and May Brent crude oil is at $49.12, down $0.87 or -1.76%.
4 Natural Gas Price Fundamental Daily Forecast
https://www.fxempire.com/forecasts/article/natural-gas-price-fundamental-daily-forecast-strengthens-over-1-745-weakens-under-1-720-637246
The April natural gas short-term range is $1.642 to $1.847. Its retracement zone at $1.745 to $1.720 is currently being tested. Trader reaction to this zone will determine the short-term direction of the natural gas market.
Natural gas futures are under pressure early Friday after posting an outside move, lower close the previous session. Despite the steep two day plunge, the market is still up after posting three days of solid gains earlier in the week.
5 Weekly Resin Report: Commodity-grade Resins Largely Resilient amid Market Meltdown
https://www.plasticstoday.com/resin-pricing/weekly-resin-report-commodity-grade-resins-largely-resilient-amid-market-meltdown/172841593062533
The resin markets were pushed and pulled by opposing supply/demand forces last week, which set a very nervous tone. Market participants took a big step back as another wave of coronavirus news shocked the stock market with fears it might trigger an economic slowdown. That sent many commodity markets, upstream energies included, into a downward tailspin, reports the Chicago-based PlasticsExchange in its Market Update. But what about commodity grade resins? Interestingly enough, North American plastics prices have held up amazingly well and saw mixed results last week.
6 Will We Really See Negative Oil Demand Growth This Year?
https://oilprice.com/Energy/Energy-General/Will-We-Really-See-Negative-Oil-Demand-Growth-This-Year.html
The outlook for the global economy continues to darken, and a growing number of analysts see oil demand contracting in 2020.
Despite the recent rebound in oil prices – largely stemming from the first 50 basis point interest rate cut since the global financial crisis and expected OPEC+ cuts – the coronavirus is showing no signs of slowing down.
7 US February ethylene contracts settle at decrease amid ample supply
https://www.icis.com/explore/resources/news/2020/03/04/10478504/us-february-ethylene-contracts-settle-at-decrease-amid-ample-supply
US February ethylene contracts settled for a majority of participants at a decrease of 1.75 cents/lb ($39/tonne), tracking lower spot as cracker start-ups and expansions in upstream fractionation capacity continue to boost already ample supply.
The settlement puts February ethylene contracts at 24.00 cents/lb, down from 25.75 cents/lb in January.
8 Ohio Valley to house petrochemical complex, company expects FID by mid-2020
https://www.bicmagazine.com/expansions/downstream/ohio-valley-to-house-petrochemical-complex/
PTT Global Chemical, a subsidiary of PTT Group, is allocating $5 billion for its next investment in Ohio.
Chief Executive Kongkrapan Intarajang said the company is on track to make a final decision on the U.S. project by mid-2020. The process is moving as planned, including approval from U.S. authorities, environmental assessments and the choice of a construction company, the CEO said.
9 Mexican firm takes millions of barrels of Venezuelan crude in oil-for-food swap
https://www.reuters.com/article/us-mexico-venezuela-oil-idUSKBN20T01B
Venezuela has swapped millions of barrels of crude for supplies of corn and water trucks under an oil-for-food deal struck with a Mexican firm, in an effort to secure imports amid tightening U.S. sanctions, according to the company and export schedules.
10 Exclusive: Mexican private sector pitches $92 billion in energy investment
https://www.reuters.com/article/us-mexico-energy-exclusive-idUSKBN20S048
Mexico’s private sector has drawn up a broad package of proposed energy investments for the government worth almost $92 billion, according to a document seen by Reuters on Wednesday, providing a potential lift to the country’s misfiring economy.
11 Oil industry investment in petrochemicals poses risk for independent producers
https://www.britishplastics.co.uk/News/oil-industry-investment-in-petrochemicals-poses-risk-for-ind/
Moody’s Investors Service has said that it expects large oil companies to accelerate investment in new petrochemicals capacity over the next decade, increasing business and event risk for rated petrochemical companies.
12 LyondellBasell and Bora form petrochemical joint venture
https://www.hydrocarbonengineering.com/petrochemicals/06032020/lyondellbasell-and-bora-form-petrochemical-joint-venture/
“China is a large market with growing demand for high quality polyolefin products”, said Bob Patel, CEO of LyondellBasell. “The combination of LyondellBasell’s leading technology and Bora’s operational excellence will allow us to reliably produce and provide these needed products to local customers.”
13 Asia petchem shares slide on fears of prolonged global slowdown
https://www.icis.com/explore/resources/news/2020/03/06/10479291/asia-petchem-shares-slide-on-fears-of-prolonged-global-slowdown
The shares of major Asian petrochemical firms tracked the overnight Wall Street rout on Friday amid worsening fears that disruptions to global trade and business arising from the coronavirus outbreak will lead to a prolonged economic slowdown.
14 Industry responds to the launch of the European Plastics Pact
https://www.britishplastics.co.uk/News/industry-responds-to-the-launch-of-the-european-plastics-pac/
The plastics industry has met the launch of the European Plastics Pact with criticism, with both European Plastics Converters and the German Association for Plastics Packaging (IK) questioning its implementation.
15 EIA’s long-term power plant forecasts trade off the cost and value of new capacity
https://www.eia.gov/todayinenergy/detail.php?id=43095
A supplemental report to the U.S. Energy Information Administration’s (EIA) Annual Energy Outlook 2020 (AEO2020) describes two simple measures of cost and value that, when used together, largely explain the economic competitiveness of electricity generating technologies and, in turn, the types of power plants most likely to be built in EIA’s long-term model for the U.S. energy sector.
16 Warren Buffett’s company bails on Saguenay LNG project because of ‘Canadian political context’
https://www.cbc.ca/news/canada/montreal/saguenay-lng-project-1.5486517
Warren Buffett’s investment company Berkshire Hathaway has decided not to invest $4 billion in a liquefied natural gas (LNG) plant by the Saguenay port, according to Radio-Canada.
The marine terminal to ship LNG to overseas markets is slated to be built roughly 230 kilometres northeast of Quebec City, at a cost of $9.5 billion.
17 China petchem downstream plants ramp up output as virus spread slows
https://www.icis.com/explore/resources/news/2020/03/05/10478642/china-petchem-downstream-plants-ramp-up-output-as-virus-spread-slows
For the downstream plants of polyethylene (PE) and polypropylene (PP) plants in the provinces of Zhejiang, Guangdong and Fujian provinces, the average operating rate has improved to 50-70%, ICIS senior analyst Amy Yu said.
“We expect the operating rate of plastic processers’ factories will return to 60-75% in more regions in the coming three weeks as more migrant workers have ended their 14-days self-quarantine and return to work,” Yu said.
18 Exxon to cut Permian growth by 10% in response to price slump
http://www.worldoil.com/news/2020/3/5/exxon-to-cut-permian-growth-by-10-in-response-to-price-slump
The U.S. energy giant will cut Permian production growth by about 10% over the next two years, the company said at its analyst day in New York on Thursday, but will stick to its long-term plan to almost triple output from the basin by 2024.
19 1Q Oil Demand Fall Expected to be Largest Ever
https://www.rigzone.com/news/1q_oil_demand_fall_expected_to_be_largest_ever-05-mar-2020-161292-article/
World oil demand will decline by the largest volume in history in the first quarter, even exceeding the declines during the 2009 financial crisis.
That’s what IHS Markit expects, according to a new industry note, which was penned by the company’s vice presidents Jim Burkhard and Dan Evans, and its executive director Das Premasish.
20 Alberta to Provide $100MM Loan for Decommissioning Efforts
https://www.rigzone.com/news/alberta_to_provide_100mm_loan_for_decommissioning_efforts-05-mar-2020-161287-article/
Alberta Premier Jason Kenney said the province is providing a $100 million government loan to the Orphan Well Association (OWA) that will create 500 jobs and ramp up investment in the region’s oil and gas sector. Kenney made the announcement earlier this week with energy minister Sonya Savage in Leduc, Alberta.
21 Coronavirus Hurts Middle East Economies Beyond Oil
https://oilprice.com/Geopolitics/Middle-East/Coronavirus-Hurts-Middle-East-Economies-Beyond-Oil.html
The Middle East oil exporters are grappling with depressed demand in their key market, China, due to the coronavirus outbreak.
The economies of the Arab Gulf countries are feeling the double sting of a sizeable loss of oil demand in Asia and a plunge in oil prices as the markets fear a significant slowdown in global economic growth because of the outbreak.
