Daily Chemical Reactions

Smoke On The Water – Asia Ethylene Dives, Cost Curve Developments To Gain Incremental Focus
July 7, 2020
Commodities Mentioned:
Oil, Natural Gas, Ethane, Naphtha, Ethylene, Propylene, Polyethylene, Polypropylene, Polyvinyl Chloride, Isocyanates, MTBE
Companies Mentioned:
Westlake, Olin, Methanex, Dow, ExxonMobil, CP Chem, CPC, Huntsman, Covestro, BASF, Sadara, Wanhua, Indorama, Linde, Celanese, Valero, Total

Daily Chemical Reaction

 

Smoke On The Water – Asia Ethylene Dives, Cost Curve Developments To Gain Incremental Focus   

Key Points:

  • Asia ethylene prices fall WoW as confidence rises around supply in 3Q20 – this setting suggests disappointments ahead for US derivative prices and profit among integrated and non-integrated exporters, in our view.
  • We think greater 2H20/1H21 Asia (and US) production (and lower chemical prices) will put focus on cost curve shifts, and we view the risk for USGC producers reflected in current US Natural gas forward prices is overblown at this point.
  • Other items today target oil-and-gas news, commodity price shifts/industry reports of note, and recent news from Linde, Dow and Total.

See PDF below for all charts 

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