Daily Chemical Reactions

Bosa Nova: Can The Middle East (and Wall Street) Slow Dance with The Brazilians?
May 9, 2023
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
Braskem, ADNOC, Dow, LyondellBasell, ExxonMobil, Chevron Phillips Chemical, BayStar, Nova Chemicals, Shell, Borealis, Origin Materials, Vertex Energy, OMV, INEOS, Apollo, Borouge, Aramco, Cabot, Indorama, Li-Cycle, Glencore, TotalEnergies, Berry Global, ConocoPhillips, Pembina Resources, Valero, PKN Orlen, Williams, Novonor, Evonik, IFF, Trinseo, Kinder Morgan, Neste, Cepsa, Tredegar, SK Global

Daily Chemical Reaction

Bosa Nova: Can The Middle East (and Wall Street) Slow Dance with The Brazilians?

Key Points:

  • A very complicated deal may be under way for control of Braskem, with ADNOC a less obvious buyer than its affiliates/partners – will synergies outside Brazil offset political risk in Brazil.
  • Crude oil and international gas prices continue to fall in absolute terms and relative to US natural gas – this is incrementally bad for US chemical producers but far from problematic yet.
  • Origin is highlighting a strategy partnership a day before reporting earnings – unlikely a good sign, but this technology, even if it has teething problems could still be a game changer.
  • Separately we look at carbon values – a topic for this week’ ESG and Climate report, noting that a lack of carbon pricing or credits outside the US, Canada and Europe is a growing issue.
  • Otherwise, we look at whether downstream consolidation/rationalization could drive further inventory corrections in the US, and question the inflationary impact of machinery demand.

See PDF below for all charts, tables and diagrams

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