Global Weekly Catalyst No. 279

Base Chemical Global Analysis

Global Weekly Catalyst No. 279

• General Thoughts: The Aramco and Braskem 1Q earnings call highlighted a strategic divergence, as one bets on global integration and scale, while the other focuses on feedstock agility, regional resilience, and sustainability.  
• Feedstocks & Energy: Global feedstock economics are fracturing—old models are breaking down as regional volatility, shifting co-product values, and supply chain mismatches redefine what “low-cost” really means.
• Olefins: USGC olefins saw brief support last week from production issues, but global softness, weak derivative demand, and looming international capacity additions suggest recent spot price strength could be short-lived.  
• Other Base Chemicals: Methanol’s continued global slide highlights a widening global imbalance, as resilient supply outpaces lackluster demand, raising pressure on Southeast Asia just as arbitrage support begins to crack.
• Agriculture: Tight supply and strong domestic corn-driven demand support US (and global) nitrogen prices. However, rising natural gas costs and looming global supply improvements could flip sentiment by 2H25.
• Refining & Biofuels: US refining margins remain strong amid regional strain despite tightening crude flows. At the same time, a new UK trade deal looks like a plus for ethanol exports, though structural headwinds persist.

Exhibit 1 – Chart of the Day: Global feedstocks and base chemical prices are broadly lower than their 1Q25 averages.  

Source: Bloomberg, C-MACC Analysis, May 2025