Sunday Thematic & Weekly Recap

US Natural Gas – Competitive Advantage or Seductive Siren?
April 9, 2023
Commodities Mentioned:
Plastics, PVC, Polyethylene, Polypropylene, PU, PC, PET, Critical Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha, SAF, EVs, Biodegradable Polymers, DAC, Biofuels, Chemicals, Ammonia, Lithium, Nuclear
Companies Mentioned:
LyondellBasell, Dow, Nova Chemicals, INEOS, ExxonMobil, Westlake, Enterprise Products, Navigator Holdings, PPG, Trinseo, BASF, Linde, Nouryon, Synthomer, Givaudan, Amyris, Clariant, Grupa Azoty, Tianqi, Ganfeng Lithium, Venator, Teijin, Lanxess, TotalEnergies, Posco, Asahi Kasei, Epsilyte, OMV, Aker Carbon Capture, Borealis, Alcoa, Lummus, Baker Hughes, QatarEnergy, Osaka Gas, Mitsubishi Heavy Industries, Valero, Cleveland-Cliffs, Tesla, Rivian, Origin Materials, Donaldson, Albemarle, Livent, SQM, Ganfeng, Glencore, Umicore, Freeport-McMoRan, Sumitomo, Huntsman, KBR, Mitsubishi Chemical, Solvay, NET Power, Iberdrola, Teck Resources, Kinder Morgan, Ecopost, Plug Power, Humble Midstream, Yara, Enbridge, Stratasys, Covestro, Ascend, Electra Battery Material, Mitsubishi Power, Repsol, Halliburton, Breakthrough Energy, LanzaJet, Virgin Orbit, Danimer Scientific, Lucid, Nikola, Gevo, Bloom Energy, Aemetis, Polestar, Ginko Bioworks, Renewable Fuels Group, Chevron, bp, Archaea, Occidental, Shell, Google, Air Products, Li-Cycle, MSCI, McKinsey, Formosa Plastics, Sherwin-Williams, RPM, Neste, Brooge Energy, Borouge, InterPipeline, Agilyx, Ineos Styrolution, PKN Orlen, Standard Industries, W.R. Grace, Versalis, AGCO, Bosch, IMCD, Evonik, Toyobo, Mitsubishi Corp., LG Energy Solutions, Graham Corp, ConAgra, Walmart, Ford, Stellantis, Petrobras, Dominion Energy

C-MACC Sunday Thematic & Weekly Recap 163

US Natural Gas – Competitive Advantage or Seductive Siren?

  • Cheap US natural gas and NGLs favor long-term chemical oversupply and export market dependence – it could drag the US industry onto the cliffs longer term.
  • With the OPEC move this week we get some confirmation in our thesis that OPEC will keep national incomes high; concerned about eventual oil demand decline.
  • Higher oil prices drive higher US oil production which drives higher US natural gas and NGL production – keeps the US surplus natural gas, ethane, propane, etc.
  • Autos have started the year well, with easy comps, but we remain very negative on the near-to-medium-term outlook, and more of the new EV makers could fail.
  • Otherwise, we look at the gift of propylene in 1Q, and its likely reversal in 2Q, the collapse in lithium prices, and slower manufacturing in the US.

Last week we discussed 23 Chemicals and Related Products and 119 Companies.

See PDF below for all charts, tables and diagrams

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