How the epidemic and oil price trends will affect chemicals

According to ICIS August 6, the general increase in demand promoted the growth of chemical production in the second quarter, and the global chemical operating rate also increased in June.

The latest global data from the American Chemistry Council shows that despite significant regional differences, the growth momentum in June has increased, which has increased management’s general expectations for continued growth in the second half of this year or at least in the third quarter.

The supply shortage in the European Acrylonitrile Butadiene Styrene (ABS) market is expected to continue until the second half of 2021, as continued pressure may prevent any relief of the difficult market situation, including production problems in the supply chain, imports Low volume and strong demand.

The bullish spot price of US glycol ether opened up an arbitrage of European propylene glycol methyl ether (PM) exports in the third quarter.

Petrochemical demand in the Middle East is on the rise in the summer, while market participants continue to solve the problem of high freight rates and severe container shortages.

However, as the Delta strain spreads to every corner of Asia, the rapid increase in cases may put economies into trouble. To some extent, the highly infectious Delta variant may even subvert the petrochemical and petrochemical market demand.

Port congestion may continue to affect the demand for ABS in Asia, as buyers in the supply chain choose to postpone purchases in the event of delays in the arrival of goods.

The chemical market may be artificially boosted by the increase in supply chain extension inventory, but weak downstream demand may lead to rapid destocking in the second half of 2021.

At the same time, the refrigerant regulations coming into effect in the United States should encourage buildings to switch to hydrofluoroolefins (HFOs) and other low-enemy greenhouse gases, as most automakers have already switched to.