A Year-End Strategy Rethink – Tariffs and China Surpluses Likely to Upset Holiday Plans!

Companies Mentioned: Methanex, Celanese, LyondellBasell, Mitsui, Mitsubishi Gas Chemical, SABIC, BASF, Sinopec, Ineos, Atlas Lithium, E3 Lithium, Galp, Posco, SK On, Qatar Energy, CBC Investments, ExxonMobil, New Fortress Energy, Dow, Nova Chemicals, Air Liquide, Eastman, Aramco, ArcelorMittal, Corteva, BP, Topsoe, Norsk Hydro, ACME Cleantech, Rivian, NorthVolt, Berry Global, Thyssenkrupp, GM
Commodities Mentioned: Methanol, Acetic Acid, Formaldehyde, Polyamides, Lithium, Ethylene, Butadiene, Crude Oil, Natural Gas, LNG, Hydrogen, Ammonia

Key Findings

General Thoughts: Western spot methanol prices have increased in 2024 in absolute terms and relative to Asia, benefiting cost-advantaged producers but hurting non-integrated derivative product margins, notably in Europe.
Supply Chain/Commodities: We discuss the recently issued contract methanol postings from Methanex for December and the drop in global spot butadiene prices, notably in Asia in absolute terms and relative to ethylene.
Energy/Upstream: We provide views on global oil and natural gas market developments and potential regional impacts from Trump’s trade policies. US gasoline prices have also sunk to Thanksgiving lows, last seen in 2020.
Sustainability/Energy Transition: We provide our takeaways from COP29, highlight European green investment delays due to policy uncertainties and our view that there is no silver lining for green hydrogen outside of China.
Downstream/Other Chemicals: We highlight Best Buy, HP, and Dell business updates highlighting weak electronic sales, recent US Dollar strength compared to most major currencies, and weak European economic indicators.