Friday, March 13, 2020
Energy, Petrochemicals and Plastics 55
1 Oil Price Fundamental Daily Forecast
https://www.fxempire.com/forecasts/article/oil-price-fundamental-daily-forecast-thin-markets-underpinned-by-higher-demand-for-risky-assets-638497
U.S. West Texas Intermediate and international-benchmark Brent crude oil futures are edging higher on Friday shortly after the regular session opening. The move is being fueled by stronger demand for risky assets after U.S. stock index futures soared to limit up in the pre-market session.
2 Natural Gas Price Fundamental Daily Forecast
https://www.fxempire.com/forecasts/article/natural-gas-price-fundamental-daily-forecast-strengthens-over-1-851-weakens-under-1-801-638317
Natural gas futures are trading lower on Thursday but rebounding after touching an important short-term technical support level shortly before the regular session opening and the U.S. Energy Information Administration’s (EIA) weekly storage report at 14:30 GMT. Traders are blaming yesterday’s weakness and today’s follow-through to the downside on economic uncertainty after the World Health Organization (WHO) declared the coronavirus outbreak a pandemic.
3 Weekly Resin Report: Caution Spreads through Spot Market
https://www.plasticstoday.com/resin-pricing/weekly-resin-report-caution-spreads-through-spot-market/178120888462590
While there was a good flow of buyer inquiries, processors were a bit shy to confirm orders and those that did conclude, were generally for truckloads rather than railcars. Some additional deals were struck with resellers for urgent shipment because of railcar delays from Canada; otherwise, traders were looking to sell surplus inventory rather than add to current stocks.
4 $20 oil not far off as OPEC+ is capable of unleashing 2.5 million extra bpd on the market
https://www.rystadenergy.com/newsevents/news/press-releases/20-oil-not-far-off-as-opecplus-is-capable-of-unleashing-2point5-million-extra-bpd-on-the-market/
Oil prices could fall into the low $20s for the global market to rebalance, as Rystad Energy expects an increase in global supplies in the next three months. OPEC+ countries are locked and loaded to add between 1.5 million and 2.5 million barrels per day (bpd), which we estimate is their realistic short-term capability.
5 EIA Cuts 2020 Oil Price Forecast
https://www.rigzone.com/news/eia_cuts_2020_oil_price_forecast-13-feb-2020-161084-article/
The U.S. Energy Information Administration (EIA) has cut its Brent oil price forecast for 2020, its February short-term energy outlook (STEO) report has revealed.
The EIA’s Brent spot average forecast for 2020 is now $61.25 per barrel. This marks a notable drop from the 2020 Brent spot average forecast posted in its January STEO, which stood at $64.83 per barrel.
6 Oil Price Crash: 3 Things You Need To Know Today
https://www.woodmac.com/news/editorial/oil-price-crash-3-things-you-need-to-know-today/
Wood Mackenzie estimates that in the first quarter oil consumption will be 2.7 million barrels per day lower than in the same period of 2019. The OPEC+ group of countries has compounded the problems facing oil producers by failing to agree a cut in output, with Saudi Arabia and Russia leaving an acrimonious meeting in Vienna vowing to increase production. As a result, Brent crude has plummeted to about $37 a barrel, with West Texas Intermediate (WTI) at about $33 a barrel.
7 Asian petrochemical markets see volatility as coronavirus pandemic spreads
https://www.spglobal.com/platts/en/market-insights/latest-news/petrochemicals/031220-asian-petrochemical-markets-see-volatility-as-coronavirus-pandemic-spreads
In the Asian petrochemical market, the benchmark paraxylene CFR Taiwan/China marker shot up $36.50/mt on Tuesday to $618.83/mt after falling $100.50/mt on Monday to an 11-year low, but failed to rise further on Wednesday, ending the day unchanged from Tuesday.
8 OPEC+ deal collapse, virus double whammy to keep oil in $30s range – Reuters poll
https://www.reuters.com/article/us-global-oil-poll-idUSKBN2101DQ
Analysts in the snap poll slashed their forecasts of Brent crude prices LCOc1 to $42 a barrel on average this year versus the $60.63 consensus in the February monthly poll.
The global benchmark is expected to average about $34.87 in the second quarter and $39.05 in Q3, before regaining some ground to $44.08 in the final quarter. The survey of 21 analysts forecast U.S. crude CLc1 will average $30.37 per barrel in Q2 and about $37 for the year.
9 U.S. energy guru Yergin sees no easy way out of oil price collapse
https://www.reuters.com/article/us-usa-oil-yergin-idUSKBN20Z3UW
U.S. energy historian Daniel Yergin said it could be a long time before pressure is eased on sinking oil markets as the coronavirus causes public events and schools to close while global oil producers flood markets with crude. “It’s a problem of an oil price war in the middle of a constricting market when the walls are closing in,” Yergin, who is also vice chairman of IHS Markit, told reporters at the U.S. Department of Energy’s headquarters.
10 Oil market set for record surplus amid virus-led demand slump: Goldman Sachs
https://www.reuters.com/article/us-commodities-research-goldmansachs-idUSKBN2100TC
Goldman Sachs said the oil market could see a record surplus of about 6 million barrels per day by April, considering a bigger- than-expected surge in low-cost output, while a slump in demand was “increasingly broad” triggered by the coronavirus outbreak.
11 The Great U.S. Shale Decline Has Already Begun
https://oilprice.com/Energy/Energy-General/The-Great-US-Shale-Decline-Has-Already-Begun.html
U.S. shale companies are moving quickly to ax their budgets, hoping to staunch the bleeding as the oil market continues to melt down.
It has only been a few days after the OPEC+ debacle, but with oil trading at around $30 per barrel, and with good odds of falling even lower, the entire energy industry has little option but to make deep cuts to their operations.
12 The Real Oil Demand Shock Is Yet To Come
https://oilprice.com/Energy/Energy-General/The-Real-Oil-Demand-Shock-Is-Yet-To-Come.html
Oil demand has been revised downward several times since the start of the year by nearly every analyst or banking institution thanks to the devastating impact of the coronavirus. With the number of coronavirus cases in China–the world’s largest oil importer–seemingly leveling off in recent days, some may be taking the view that the worst of the oil demand shocks is now behind us.
13 DSM announces partnership with SABIC and UPM Biofuels to create bio-based Dyneema
https://www.britishplastics.co.uk/News/dsm-announces-partnership-with-sabic-and-upm-biofuels-to-cre/
Royal DSM has announced a partnership that will help to reduce the environmental footprint of Dyneema, the world’s strongest fibre.
The collaboration will see Dyneema transition to bio-based feedstock leveraging SABIC’s ground-breaking TRUCIRCLE solutions for certified renewable products.
14 OMV to sell $2.3 billion of assets to fund purchase of plastics maker
https://www.reuters.com/article/us-borealis-m-a-omv-idUSKBN20Z15W
Austrian oil and gas group OMV plans to sell $2.3 billion of assets by the end of next year to help fund a $4.7 billion deal to make it the majority owner of plastics maker Borealis and one of the world’s leading polymer producers.
15 Mexico to invite oil and gas investment, no auctions for now
https://www.reuters.com/article/us-mexico-economy-herrera-exclusive-idUSKBN20Z0E0
Mexico will soon invite private firms to invest in oil and gas projects to help a flagging economy hit by the fallout of coronavirus, Finance Minister Arturo Herrera said on Wednesday, but cautioned energy auctions were not on the cards for now.
16 Oil price plunge ramps up pressure on Pemex; hedge programs in focus
https://www.reuters.com/article/us-mexico-pemex-debt-idUSKBN20W369
A crash in crude prices has intensified pressure on the finances of Mexican state oil firm Petroleos Mexicanos (Pemex), which is facing the threat of a ratings downgrade after posting one of its worst-ever losses last year.
17 Wood Mackenzie: oil market rout could boost Asia’s gas demand
https://www.lngindustry.com/liquid-natural-gas/12032020/wood-mackenzie-oil-market-rout-could-boost-asias-gas-demand/
The consultancy claims that, in the short-term, the biggest downside risk from the oil price crash to gas supply is associated with gas production, largely from unconventionals in the US. Nonetheless, it is not an immediate effect, as Wood Mackenzie claims prices are still generally above variable wellhead operating costs.
18 Latin American petchems could take a hit on currency depreciation across the region
https://www.spglobal.com/platts/en/market-insights/latest-news/petrochemicals/031220-latam-petchem-could-take-a-hit-on-currency-depreciation-across-the-region
Latin American countries are expected to face challenges in the petrochemical trade flow following currency exchange depreciation in the region due to uncertainties generated by the coronavirus pandemic and a global stock market collapse, which could decrease volumes or create payment issues, sources told S&P Global Platts on Thursday.
19 Russia to OPEC: deeper oil cuts won’t work
https://www.reuters.com/article/us-oil-opec-russia-exclusive-idUSKBN20Y2TJ
Last week, Saudi Arabia failed to secure Moscow’s support for deeper output cuts at a meeting of the Organization of the Petroleum Exporting Countries and its allies, known as OPEC+.
Following the disagreement, Saudi Arabia has threatened to flood the market with oil. Oil prices LCOc1 dropped by as much as a third on Monday and fell again on Wednesday to around $36 a barrel.
20 Cenovus spending cut expected to set trend as sector adjusts to oil prices
https://www.canadianmanufacturing.com/operations/cenovus-spending-cut-expected-to-set-trend-as-sector-adjusts-to-oil-prices-248694/
Forecasts for a stand-pat year for drilling in 2020 in the Canadian oilpatch are up in the air following an oil price crash March 9 linked to a dispute between Russia and Saudi Arabia over oil production cuts.
In its 2020 forecast in November, the Canadian Association of Oilwell Drilling Contractors predicted 4,905 wells would be drilled in Canada this year, a slight increase over 2019 but less than half the 11,226 wells drilled in 2014.
21 Big Oil Prepares To Suffer In 2020
https://oilprice.com/Energy/Energy-General/Big-Oil-Prepares-To-Suffer-In-2020.html
When Rystad Energy analysts last November told Bloomberg that Big Oil investors were in for a windfall of dividends and share buybacks as the companies shifted into renewables, they couldn’t have known that just four moths later oil prices would dive to lows unseen for years and that the prospects of an improvement will be bleak.
22 The future of packaging
https://www.packagingnews.co.uk/features/comment/ali-kaylan-future-packaging-11-03-2020
“How could packaging evolve in the coming decades?” – that’s a common question being asked by brands and producers as the food and beverage industry undergoes dramatic changes. What will packaging look like in the future?
