Together We’re Better – Chemical Producers With Advantaged Energy Integration To Rule The Roost

Daily Chemical Reaction

Together We’re Better – Chemical Producers With Advantaged Energy Integration To Rule The Roost

Key Points:

• The North American ethylene advantage relative to Asia is significant and likely to remain high as energy and chemical producers integrate in this market – a trend we see as likely inevitable.
• The oil majors and NOCs narrative at CERA highlights one we have been supported for a few years now – the focus should not be to eliminate fossil fuels, it should be on cutting emissions.
• We highlight movements in US, Europe, and Asia ethylene production margins and discuss why China ethylene demand growth as a percentage of global demand is less than in other chains.
• We discuss the EIA short-term energy outlook as it relates to implied petrochemical cost curve movements, and we also illustrate how the EU’s ban on diesel is shifting global trade patterns.
• The US PMI reflects contraction in February, while the China PMI reflects strength. Most are relying on China as the global growth engine to lift all boats in 2023, a view far from risk free.

See PDF below for all charts, tables and diagrams