Mind The Gap: Ethylene Economics, NGL Growth, & the Rising US-China Consumer Price Divide

Companies Mentioned: Navigator Holdings, LyondellBasell, Celanese, Nova Chemicals, Enterprise Products, Phillips 66, PTT Global, Braskem, Chevron Phillips Chemical, ARC, ExxonMobil, Chevron, NextDecade, NextEra, Baker Hughes, Western Midstream, Kinetik Holdings, MPLX, Oneok, Targa Resources, Energy Transfer, Fluence Energy, Woodside Energy, BayWa, RWE, Northvolt, TotalEnergies
Commodities Mentioned: Ethylene, Propylene, Polyethylene, NGL, Ethane, LPG, Natural Gas, Crude Oil, LNG, LPG/Ethane, Battery, Solar Power, Wind Power, Hydrogen

Key Findings

General Thoughts: US consumer price inflation moderated relative to most expectations in February; however, it increased significantly relative to Chinese consumer prices, which witnessed declines – this is a concerning trend.
Supply Chain/Commodities: We discuss our takeaways from the Navigator Gas earnings call and our view that the price difference between Asia and Europe ethylene and US ethylene will likely fall amid rising competition.
Energy/Upstream: We discuss NGL export growth and benefits surrounding US midstream players with the flexibility to swing output between exports, domestic consumers, and internal domestic derivative production.
Sustainability/Energy Transition: We discuss US battery storage growth, highlight our takeaways from the Fluence Energy 1Q25 earnings call, and why US sellers in the battery market face global competitive challenges.
Downstream/Other Chemicals: Global freight rates are falling, favoring enhanced global trade, while the US dollar remains strong and weak overseas prices continue to hurt US petrochemical export market economics.