Can Europe Regain Its Competitiveness?!

Companies Mentioned: BP, Westlake, OMV, Borouge, Shell, SABIC, Versalis, LyondellBasell, Volkswagen, Rosneft, AZEK Company, ExxonMobil, Phillips 66, Ørsted, LG Chem, Huntsman, Dow, Enterprise Products, Dominion Energy, Corteva, Adnoc, Tesla, Geely, Albemarle, Rio Tinto, SQM, Gangfeng Lithium, Mineral Resources, BHP, Anglo American, Pilbara Minerals, Freeport-McMoran, Glencore, Deep Seek, CF Industries, LSB Industries, Nutrien, Koch Fertilizer, ONEOK, MPLX
Commodities Mentioned: Polyvinyl Chloride, Polyethylene, Polypropylene, Ammonia, Hydrogen, Methanol, EVs, Carbon, Ethylene, Propylene, Crude Oil, Natural Gas, LNG, LPG, Coal, Critical Minerals, Copper, Lithium, Rare Earths, Antimony, Gallium, Germanium

European energy, chemical, and associated market restructuring remain ongoing amid high costs, broadly weak domestic demand, and regional policies often counterproductive to its economy and competitive position.
EU auto emission reduction targets and associated penalties toward automakers to push them to produce more EVs are poised to add stress to its already struggling domestic industry and its global competitive position.
We discuss further energy, chemical, and associated market restructuring and consolidation in Europe, flagging the potential BP refinery and chemical unit sales in Germany and our takeaways from a few 4Q earnings calls.
European spot polymer prices remain among the highest globally, and we highlight European PVC prices relative to the US and Asia, its recent ADDs on US PVC, and its high prices being a likely downstream demand challenge.
Otherwise, we discuss factors favoring global ammonia price support, rising efforts to move more US LPG into the export market, and flag key items from hydrogen and sustainability reports focused on critical minerals.

Exhibit 1: The German automotive industry’s concerns about its global competitiveness remain high and should be!