Daily Chemical Reactions

Shutdowns Needed To Quicken Global Chemical Cycle Recovery – Major Cuts in China & North America Unlikely!
August 29, 2023
Commodities Mentioned:
Plastics (PVC, PP, PE, PU, PC, PET, etc.), Clean Energy Minerals, Carbon Dioxide, Hydrogen, Natural Gas/NGLs, Crude/Naphtha
Companies Mentioned:
Sinopec, Aramco, Shell, Lotte Chemical, Formosa Plastics, LyondellBasell, Bakelite Synthetics, Sinofert, S-Oil, Sumitomo Chemical, SCG Chemicals, Bloom Energy, ExxonMobil, Equitrans, Crescent Point, Vulcan Energy, Chevron, Braskem, Marathon Petroleum, DSM-Firmenich, Univar, Lanxess, Brenntag, Kronos, Owens Corning, VinFast, BYD, Tesla, Citgo, Petrobras, Vanguard, Blackrock, Fortescue, Oneok, Piedmont Lithium, Fisker, CNOOC, Sappco, Nucera, ADES Holding

Daily Chemical Reaction

Shutdowns Needed To Quicken Global Chemical Cycle Recovery – Major Cuts in China & North America Unlikely!

Key Points:

  • Global chemical oversupply will likely worsen into year-end as North America’s cost advantage and China’s unrelenting production push will overtake cutbacks that will likely occur elsewhere.
  • We discuss Sinopec 1H23 results and its 2H23 outlook commentary, which anticipates demand improvement in China and continued investment in petrochemicals despite global oversupply.
  • We discuss the ExxonMobil 2050 energy outlook, which fits well with our view that many oil & gas majors will likely further integrate downstream beyond transportation fuels into chemicals.
  • Recent strength in gasoline and diesel prices has lifted 3Q23 oil refinery profit, with US refinery margins at a YTD high and associated ethanol markets also reflecting support at elevated levels.
  • We discuss the supply-driven economy in China relative to a consumer-led one in the US, the strength in US mortgage rates as they are now near 8%, and the recent expansion of BRICs.

See PDF below for all charts, tables and diagrams


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