Daily Chemical Reactions

1Q23 Chemical Updates Beat Already Low Views, Global Game of Sector Profit Whack-A-Mole Ahead for Many
April 12, 2023
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
BASF, OMV, ConocoPhillips, Methanex, Southern Chemical, LyondellBasell, Celanese, Mitsui Chemicals, Dow, ExxonMobil, Nova Chemicals, Chevron Phillips Chemical, Ineos, Formosa Plastics, Shell, Baystar, EnergyX, Brookfield Asset Mgmt, Origin Energy, Neste, Worley, Clariant, TotalEnergies, Toray, Emerson Electric, Asahi Kasei, Sinopec, Sabic, Lummus, Azelis, Chemours, Thyssenkrupp, Apogee Enterprises, Mercedes, Glencore, Boeing

Daily Chemical Reaction

1Q23 Chemical Updates Beat Already Low Views, Global Game of Sector Profit Whack-A-Mole Ahead for Many

Key Points:

  • We discuss OMV and BASF 1Q23 business updates, adding further proof that chemical sector business conditions were “less bad” than expected. However, it could be the eye of the storm.
  • North American chemical production costs declined more in 1Q23 than domestic and Ex-US end-market prices, and we illustrate this point by showing China and US methanol margin trends.
  • While our views are also positive, ConocoPhillips investor day commentary seems to unite to erect an overly optimistic outlook based on the extrapolation of recent oil and gas market trends.
  • GHG emission reduction targets from oil and gas producers are mostly constrained to Scopes 1 and 2. We flag the ConocoPhillips outlook and several other sector updates worth considering.
  • US consumer price inflation moderated YoY in March, but spending headwinds remain stiff. We also highlight ifo price survey expectations for Germany and Baltic Index improvement YTD.

See PDF below for all charts, tables and diagrams


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