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US investors in talks to overturn sanctions related to Russian gas supply corridors Nord Stream 2 and TurkStream 2 corridors would theoretically displace 110 billion cubic meters of alternative gas supplies Talks continue, but significant political, regulatory, technical hurdles remain LONDON (ICIS)–High-profile investors with links to US president Donald Trump’s family have been in talks to lift US sanctions against the Nord Stream corridor while snapping up stakes in other pipeline networks used to ship Russian gas to Europe, four sources familiar with discussions told ICIS. The talks follow reports last month that the owners of Nord Stream 2 AG, a Swiss-registered company overseeing the construction and operation of the Nord Stream 2 pipelines, had reached a deal to restructure its debt and pay small-scale creditors. Bringing Nord Stream into operation would entail clearing significant political, regulatory and technical hurdles. Despite this, sources close to the EU and US Congress interviewed by ICIS say investors are positioning themselves for a post-war scenario where a settlement agreement is reached for Ukraine and Russian gas exports to return. Three of the four subsea Nord Stream pipelines connecting Russia to Germany were damaged in 2022 and would need heavy repairs to be brought back into use. The fourth line, built as part of Nord Stream 2, is thought to be intact but would require maintenance before becoming operational. The resumption of full flows on the four Nord Stream pipelines would displace as much as 110 billion cubic meters of alternative gas supplies and eliminate the need for other Nordic, Baltic or southern European transport routes to emerge. US sanctions introduced five years ago ban individuals from selling, leasing or providing vessels engaging in pipe-laying or services to the Nord Stream 2 and TurkStream 2 pipelines. Yet sources say Stephen Lynch, a Republican donor and Miami-based investor with experience in acquiring distressed Russian assets, had paid off the Nord Stream debt and was actively lobbying European and US policymakers for the lifting of sanctions. INTERMEDIARIES One of the individuals Lynch has been in talks with is Texas businessman Gentry Beach, all sources confirmed. Beach has links to the US president’s son, Donald Trump Jr. Beach himself has been in touch with Romanian offshore logistics company GSP Offshore with a view to bringing Nord Stream back into use one, sources in the EU and US said. The company has provided drilling and support services to Gazprom in the past but is currently facing financial problems after racking up debt, according to company documents seen by ICIS. GSP Offshore did not respond to questions from ICIS. BULGARIAN LINK Gentry Beach’s name also recently surfaced in talks related to the acquisition of a stake in Bulgaria’s gas transmission infrastructure, which connects to TurkStream2 and is used for the transport of Russian gas to central Europe, according to two EU sources familiar with discussions. They explained Beach had been in contact with Bulgarian gas grid operator Bulgartransgaz after Elliott Investment Management, a US hedge fund managing over $70bn in assets, pulled out less than a month after signalling interest in acquiring a stake. Lynch and Beach did not reply to questions from ICIS. Bulgartransgaz did not reply to questions. A spokeswoman for Elliott Investment Management confirmed the company had had some preliminary discussions in Bulgaria but eventually decided to “pass on this”. LIFTING SANCTIONS The resumption of gas flows via Nord Stream 2 would hinge on the US Treasury lifting sanctions, persuading the EU that US ownership would guarantee compliance with a looming ban on Russian fossil fuel imports and lobbying German policymakers to unfreeze the certification of Nord Stream 2. Investors might find it challenging to meet these goals, the sources said. The two Nord Stream 2 pipelines, with a combined capacity of 55 billion cubic meters/year, were sanctioned in the US under the Protecting Europe’s Energy Security Act (PEESA) and the Protecting Europe’s Energy Security Clarification Act (PEESCA). Three of the four sources interviewed by ICIS confirmed Lynch had lobbied the Biden administration to remove the sanctions. Although these were not removed under the previous administration, they included a five-year sunset clause which meant they lapsed at the end of 2024. Even though Congress did not extend them under PEESA and PEESCA, they were renewed under a broader executive order authorising sanctions on individuals and entities responsible for violating the territorial integrity of Ukraine. The sanctions are now in place as part of the catch-all executive order but they would be easier to overturn than if they had been extended under PEESA and PEESCA. All four sources interviewed by ICIS remain sceptical US president Donald Trump would be willing to scrap them, given his long-running opposition to the project. GERMANY All sources interviewed by ICIS said Lynch had been actively lobbying German policymakers to approve Nord Stream 2, certification of which was halted when Russia invaded Ukraine in February 2022. Even if a strong support base in Germany may exist among some policymakers, it would still be difficult to persuade the EU that imports via Nord Stream were fully compliant with the EU Russian gas import ban. The European Commission has introduced a set of proposals aimed at fully phasing out Russian fossil fuels by 2028 and has pitched a raft of tough transparency measures designed to enforce the ban.

18-Jun-2025

Spoof signals hits vessel tracking around Hormuz Implications for ship safety and market analysis Impacting vessel scheduling to Ras Laffan but not production LONDON (ICIS)—Much focus from energy companies tracking hostilities between Israel and Iran has been on higher oil, gas and LNG prices but compromises to critical regional shipping data pose risks both to safety and wider data analysis. The corruption of the automated ship signal (AIS) data that vessels broadcast to alert others of their whereabouts has emerged in recent days, especially in and around the Straits of Hormuz, the narrow channel between Iran and Oman. On Monday 16 June, after a weekend of rocket fire between Iran and Israel, AIS data gathered by ICIS LNG Edge showed significant disruptions coming from several ships close to Ras Laffan, Qatar, in the Persian Gulf. In the case of LNG tankers, this manifested itself in ‘spoofed’ signals erroneously indicating that several vessels were located on the Iranian mainland. This was corroborated by the United Kingdom Maritime Trade Operations (UKMTO), a shipping organisation that runs a Voluntary Reporting Scheme for the sector for the Red Sea, Gulf of Aden, and Arabian Sea. “The level of electronic interference … inside the Gulf [is] having a significant impact on vessels’ positional reporting through automated systems. Vessels are advised to transit with caution and continue to report incidents of electronic interference,” the UKMTO said on 16 June. It has been reporting about GPS interference in the region since early May. AIS INTERVENTIONS Faced with these issues, ICIS LNG analysts have been carefully unpicking the satellite trails produced by spoofed LNG shipping to try to work out where they actually are. At the same time as UKMTO was issuing its warning, around six LNG vessels were broadcasting erroneous locations inside the Iranian mainland, at Asaluyeh, more or less opposite Bahrain on the other side of the Persian Gulf. These included Aseem, chartered by India’s Petronet; Rasheeda, Al Jasra, Simaisma and Maran Gas Troy – all of which are under Qatari control – and Italian Eni’s Maran Gas Efessos. Once identified, it is possible to manually delete the erroneous waypoints and reposition the vessel back where it was last reliably seen. However, given that each time the vessel broadcasts a new point it can place it back in Iran, ICIS has been generally been carrying out removals only once a vessel is clearly back on the move, as in the case of Maran Gas Troy, a laden vessel which was clearly rounding Hormuz in the evening of 17 June. MAJOR SAFETY IMPLICATIONS Together with marine radar, the AIS signature that ships broadcast to satellites is a key tool in collision avoidance for water traffic. On 17 June, however, a collision was reported between two vessels 26 nautical miles northeast of Fujairah. Footage later showed one of the vessels, an oil tanker, having sustained severe damage and burning strongly. There was “no indication the incident was the result of hostile activity resulting from the ongoing regional conflict,” UKMTO added, but the fact that the collision was caused by vessels sailing blind, rather than being hit by a missile is unlikely to calm the market significantly. This was in evidence in the rollcall of around 12 ballast vessels outside Ras Laffan at the start of the week, apparently waiting to load and move off. It subsequently emerged that QatarEnergy had reportedly instructed its ships to only make transit into the Persian Gulf the day before loading and to wait outside, in the Arabian Sea, until they were ready to do so. As of 17 June, LNG loadings from Qatar’s Ras Laffan stood at 45 over the prior 15-day period, which is squarely in line with expectations. With indications that insurance requirements have been preventing some shippers from entering the area for the time being, there is scope for further disruption.

18-Jun-2025

SINGAPORE (ICIS)–Japan's chemical exports in May declined by 5.6% year on year to yen (Y) 928 billion ($6.4 billion), contributing to the first contraction in its overall shipments abroad in eight months which raises the risk of a technical recession in the world’s fourth-biggest economy.  Total May exports fall by 1.7% on year  May exports to US shrink by 11.1% on year  Negotiations on US tariff exemption ongoing Exports of organic chemicals fell by 16.8% year on year to Y148.7 billion in May, while shipments of plastic products slipped by 1.6% to Y266.7 billion, preliminary data from the Ministry of Finance (MOF) showed. By volume, May exports of plastic materials fell by 5.7% year on year to 413,270 tonnes. Japan's total exports for the month fell by 1.7% year on year to Y8.13 trillion, reversing the 2.0% expansion in April and marked the first contraction in eight months – highlighting the impact of US President Donald Trump’s tariffs. With imports falling by 7.7% year on year to Y8.77 trillion in May, Japan registered a trade deficit of Y637.6 billion, extending its run of negative trade balances to two months. Overall shipments to the US – its largest export destination – fell by 11.1% year on year to Y1.51 trillion in May. Japan’s trade surplus with the US shrank 4.7% year on year to Y451.7 billion in May, marking the first decline in five months. Exports of cars to the US slumped by 24.2% year on year to Y358 billion in May, while shipments of motor vehicle parts fell by 19% to Y78.5 billion. Overall chemicals shipments to the US fell by 13% year on year to Y124.7 billion in May. It remains uncertain whether Japan's attempts to secure an exemption from higher US tariffs will succeed. The 90-day suspension on US reciprocal tariffs aimed at narrowing a persistent trade gap with major trade partners are due to expire in early July for most countries, except China. For Japan, Trump has imposed a 25% tariff on imports of cars and auto parts, alongside a baseline tax of 10% on all other Japanese goods. In early June, the levy on steel and aluminum was doubled to 50%. These tariffs are set to remain in place for now, as Trump and Japanese Prime Minister Shigeru Ishiba failed to reach a deal on the sidelines of the Group of Seven leaders' summit, despite two months of bilateral negotiations. The US’ 10% tariff across the board is slated to revert to 24% on 9 July, in line with announcements made in April. During talks at the G7 summit in Canada on 15 June, Ishiba confirmed that while the two countries have yet to finalize a trade package, they have agreed to continue discussions at the ministerial level. WORRIES OVER RECESSION GROWS The decline in exports and the widening trade deficit are fueling concerns that Japan’s economy could contract again in the second quarter, potentially ushering in a technical recession, which is defined as two consecutive quarters of contraction. Japan's economy contracted by 0.2% on an annualized basis in the first quarter, while the country's real GDP in price adjusted terms was flat from the previous quarter. The Bank of Japan (BOJ) on 17 June kept its policy rate steady at 0.5% and has reduced Japanese government bond purchases from by half to Y200 billion starting in April next year. In its policy statement, the BoJ reiterated that “it is extremely uncertain how trade and other policies in each jurisdiction will evolve and how overseas economic activity and prices will react to them”. "The extreme level of uncertainty is holding back the BoJ from raising rates further in the near-term," said Lee Hardman, senior currency analyst at Japan-based MUFG Research. "A trade deal between the US and Japan in the coming months could give the BoJ more confidence to hike rates further if global trade disruption eases as well." The BOJ is expected to maintain a "wait-and-see stance for longer than expected", with central bank governor Kazuo Ueda's remarks on 17 June suggesting a reinforcement of the dovish stance, Dutch banking and financial services firm ING said in a note. Ueda stated that inflation expectations have not yet anchored at 2% and expressed concerns about tariffs potentially affecting future wages. Japan's core consumer price index (CPI) in April rose by 3.5% year on year. "Governor Ueda attributed the majority of downside risks to US trade policy. Therefore, we think that unless Japan and the US reach an agreement on tariffs, the BoJ is likely to maintain its current rate stance," ING said. "Unlike early expectations that Japan might make a deal with the US, negotiations have dragged on longer than expected. Thus, the BoJ's action may be delayed to early 2026." ($1 = Y145.1) Focus article by Nurluqman Suratman Thumbnail image: At a port in Tokyo, Japan, 12 May 2025. (FRANCK ROBICHON/EPA-EFE/Shutterstock)

18-Jun-2025

HOUSTON (ICIS)–PureCycle plans to reach 1 billion lb/year (454,000 tonnes/year) of capacity in the US by 2030, Europe and Asia, the US-base recycler of polypropylene (PP) said on Tuesday. As part of that push, PureCycle has started a partnership with IRPC Public Co Limited, under which PureCycle will build a 130 million lb/year line at IRPC's complex in Rayong, Thailand. IRPC is a subsidiary of PTT. Construction should start in the second half of 2025, PureCycle said. The line should become operational in mid-2027. PureCycle will hold a 100% equity position, and IRPC will retain rights for 10% of the plant's production. PureCycle has plans to build another 130 million lb/year plant in Antwerp, Belgium. It expects to receive final permits in 2026. The plant in Antwerp should become operational in 2028. PureCycle expects to begin construction on a Gen 2 facility in Augusta, Georgia, US, in mid-2026. The facility's pre-processing (PreP) unit should be operational in mid-2026. The first purification line should be operational in 2029. PureCycle also plans to add compounding capabilities at the site, but it did not disclose timelines. The final Gen 2 design should have a capacity of more than 300 million lb/year before compounding, PureCycle said. The company will disclose design capacity in early 2026 after it finishes engineering. PureCycle will build another Gen 2 line in Thailand or Augusta. The following table summarizes PureCycle's expansion plans. Figures are in millions of pounds per year. Site Capacity Belgium 130 Thailand 130 Augusta 300+ Augusta or Thailand 300+ TOTAL 860+ Source: PureCycle PureCycle has one operating facility in Ironton, Ohio, US, that has a capacity of 107 million lb/year. The following chart illustrates the timeline for the projects. Source: PureCycle PureCycle revealed the expansion plans when it announced that it raised $300 million from new and existing investors. Those investors include Duquesne Family Office, Wasserstein Debt Opportunities, Samlyn Capital, Pleiad Investment Advisors and Sylebra Capital Management. PureCycle recycles waste PP through a dissolution process. Thumbnail shows PP. Image by Shutterstock.

17-Jun-2025

SAO PAULO (ICIS)–Braskem is to divest its controlling stake at Upsyde, a recycling joint venture in the Netherlands, as the company aims to focus on its core chemicals and plastics production, the Brazilian polymers major said. The joint venture with Terra Circular was announced in 2022 and is still under construction. When operational, it will have production capacity of 23,000 tonnes/year of recycled materials from plastic waste. Braskem’s exit from Upsyde is likely related to the company's pressing need to reduce debt and increase cash flow rather than a rethinking of its green targets, according to a chemicals equity analyst at one of Brazil’s major banks, who preferred to remain anonymous. Braskem's spokespeople did not respond to ICIS requests for comment at the time of writing. The two companies never officially announced the plant’s start-up, and in its annual report for 2024 (published Q1 2025) Braskem still spoke about the project as being under construction. “Upsyde is focused on converting hard-to-recycle plastic waste through patented technology to make circular and resilient products 100% from highly recyclable plastic,” it said at the time. “Upsyde aims to enhance the circular economy and will have the capacity to recycle 23,000 tonnes/year of mixed plastic waste, putting into practice a creative and disruptive model of dealing with these types of waste.” BACK TO THE COREBraskem said it was divesting its stake at Upsyde to focus on production of chemicals and polymers – its portfolio’s bread and butter – and linked the decision to the years-long downturn in the petrochemicals sector, which hit the company hard. Financial details or timelines were not disclosed in the announcement, published on the site of its Mexican subsidiary, Braskem Idesa. “Considering a challenging environment for the petrochemical industry and a prolonged downcycle exacerbated by high energy costs and reduced economic activity in Europe, Braskem is redirecting all resources toward its core business: the production of chemicals and plastics,” Braskem said. “We remain committed to our sustainability agenda, as demonstrated by our recent investment in expanding biopolymer capacity in Brazil and the development of a new biopolymer plant project in Thailand.” The company went on to say it will also continue to maintain “several active partnerships” to advance research and potential upscaling capabilities for chemical recycling, projects for some of which Braskem has signed agreements to be off-takers for specialized companies. The European plastics trade group PlasticsEurope was until this week listing Upsyde as a project which would make a “tangible impact by upcycling mixed and hard-to-recycle” plastic waste in Europe. That entry, however, has now been taken down. Terra Circular and PlasticsEurope had not responded to a request for comment at the time of writing. Braskem’s management said earlier in 2025 the green agenda remains key for its portfolio, adding it would aim to leverage Brazil biofuels success story to increase production of green-based polymers, a sector the company has already had some success with production of an ethanol-based polyethylene (PE), commercialized under the branded name Green PE. The other leg to become greener, they added, was a long-term agreement with Brazil’s state-owned energy major for the supply of natural gas to its Duque de Caxias, Rio de Janeiro, facilities to shift from naphtha to ethane. Last week, Braskem said that deal could unlock R4.3 billion ($785 million)  in investments at the site. GREEN STILL HAS WAY TO GOThe chemicals analyst who spoke to ICIS this week said for the moment there would be no sign of Braskem aiming to trim its green agenda, which has ambitious targets for 2030 in terms of production of recycled materials. He added Braskem’s shift from naphtha-based production to a more competitive ethane-based production will require large investments in coming years, so a strategy to increase cash flow as well as reduce high levels of debt would be divesting non-core assets and the divestment in the Dutch joint venture would be part of that plan. “Braskem has high debt levels, and they are looking for ways to reduce leverage. What they may be thinking is that, despite this divestment in a purely green project, they can still give a green spin to their operations if we consider the green PE, for which they have been expanding production,” said the analyst. “I don't think they would be relinquishing or giving up any of their initiatives to go green, but I think it's probably part of some initiatives they must increase efficiency and reduce costs and capital needs. So, they probably just saw this business as a main candidate to be divested." ($1 = R5.50) Front page picture: Braskem's plant in Triunfo, Brazil producting green PE Source: Braskem Focus article by Jonathan Lopez 

17-Jun-2025

BARCELONA (ICIS)–Europe’s chemical distribution sector is bracing for the impact of multiple geopolitical and economic challenges, including the Israel/Iran conflict. All Iran’s monoethylene glycol (MEG), urea, ammonia and methanol facilities have been shut down For methanol this represents more than 9% of global capacity, for MEG it is 3% Brent crude spiked from $65/bb to almost $75/bbl, against backdrop of reports of attacks on gas fields and oil infrastructure If Iran closes the Strait of Hormuz this will severely disrupt oil and LNG markets Expect extended period of volatility and instability in the Middle East European distributors brace for a VUCA (volatile, uncertain, complex, ambiguous) world Prolonged period of poor demand looms, with no sign of an upturn Global overcapacity driven by China, subsequent wave of production closures across Europe both a threat and opportunity for distributors Suppliers and customers turn to distributors to help navigate impact of tariffs and geopolitical disruption In this Think Tank podcast, Will Beacham interviews Dorothee Arns, director general of the European Association of Chemical Distributors and Paul Hodges, chairman of New Normal Consulting. Click here to download the 2025 ICIS Top 100 Chemical Distributors listing Editor’s note: This podcast is an opinion piece. The views expressed are those of the presenter and interviewees, and do not necessarily represent those of ICIS. ICIS is organising regular updates to help the industry understand current market trends. Register here . Read the latest issue of ICIS Chemical Business. Read Paul Hodges and John Richardson's ICIS blogs.

17-Jun-2025

SINGAPORE (ICIS)–Malaysia's revised sales and services tax (SST) framework officially takes effect on 1 July, with the expanded scope now set to include a 5% tax on an extensive range of petrochemical products, including polyethylene (PE) and polypropylene (PP). Critical raw materials for downstream industries affected Capital expenditure items like machinery now taxed Malaysian industry body calls for further delay in implementation The government had first announced the revision of items subject to the sales tax on 18 October 2024, as part of its fiscal consolidation strategy under the 2025 budget. Under the updated framework, more than 4,800 harmonized system (HS) codes will now fall under the 5% sales tax bracket. Goods exempted from the updated sales tax include specific petroleum gases and other gaseous hydrocarbons that are currently under HS code 27.11. These include liquefied propane, butanes, ethylene, propylene, butylene, and butadiene. In their gaseous state, the list includes natural gas used as motor fuel. The measure, aimed at broadening the country's tax base and increasing revenue, was originally slated to begin on 1 May, but was delayed for two months after manufacturers urged policymakers to refrain from adding to their financial burden. The July revision of Malaysia's sales tax and the expansion of the service tax scope involve several key changes. The sales tax rate for essential goods consumed by the public will remain unchanged, while a 5% or 10% sales tax will be applied to discretionary and non-essential goods. The scope of the service tax will be broadened to include new services such as leasing or rental, construction, financial services, private healthcare, education, and beauty services. This includes critical raw materials for various downstream industries, from plastics and packaging to automotive manufacturing. Previously, many of these materials were zero-rated under the SST. The Federation of Malaysian Manufacturers (FMM) has publicly criticized the decision, calling it "highly damaging to industries” in a statement released on 12 June. According to estimates by the Ministry of Finance, the SST expansion is expected to generate around ringgit (M$) 5 billion in additional government revenue in 2025. “Although this may support the government’s fiscal objectives, the additional tax burden will be largely borne by businesses and has serious implications for operating costs, investment decisions, and long-term business sustainability,” FMM president Soh Thian Lai said in a statement. Soh highlighted that with this expansion, around 97% of goods in Malaysia's tariff system will now be subject to sales tax, representing a significant departure from a previously narrower tax base, to one where nearly all categories including industrial and commercial inputs are now taxable. Under the new sales tax order, 4,806 tariff lines are now subject to 5% tax, covering a wide range of previously exempt goods, according to the FMM. These include high-value food items, as well as a broad spectrum of industrial goods, such as industrial machinery and mechanical appliances, electrical equipment, pumps, compressors, boilers, conveyors, and furnaces used in manufacturing processes, it said. The 5% rate also applies to tools and apparatus for chemical, electrical, and technical operations, significantly broadening the range of taxable inputs used in production and operations. “The expanded scope now places a direct tax burden on machinery and equipment typically classified as capital expenditure. This includes items critical to upgrading production lines, automating processes, and scaling operations,” Soh said. The FMM "strongly urges the government to further delay the enforcement of the expanded SST scope beyond the scheduled date of 1 July", until the review is complete, and industries are ready. They also calling for a broader exemption list, especially for capital expenditure items like machinery and equipment, and a re-evaluation of including construction, leasing, and rental services, which they warn will "increase operational expenses and are expected to cascade through supply chains." “We are deeply concerned and caution that the untimely implementation of the expanded scope of taxes will exert inflationary pressure, as businesses already grappling with rising costs … may have no choice but to pass these additional burdens on to consumers,” the FMM added. The FMM has urged the government to postpone the implementation, citing insufficient lead time for businesses to adapt and calling for a comprehensive economic impact assessment. Malaysia’s manufacturing purchasing managers’ index (PMI) continued to contract in May, with a reading of 48.8, according to financial services provider S&P Global. Beyond the direct sales tax on goods, the revised SST also introduces an 8% service tax on leasing and rental services for commercial or business goods and premises. This could further compound cost burdens for capital-intensive sectors, including parts of the petrochemical industry that rely on leased machinery and industrial facilities. Focus article by Nurluqman Suratman Thumbnail image: PETRONAS Towers, Kuala Lumpur (Sunbird Images/imageBROKER/Shutterstock)

17-Jun-2025

SINGAPORE (ICIS)–Singapore's petrochemical exports in May fell by 17.8% year on year to Singapore dollar (S$) 968 million ($756 million), weighing down on overall non-oil domestic exports (NODX), official data showed on Tuesday. The country's NODX for the month fell by 3.5% year on year to S$13.7 billion, reversing the 12.4% growth posted in April, data released by Enterprise Singapore showed. Non-electronic NODX – which includes chemicals and pharmaceuticals fell by 5.3% year on year to S$10 billion in May, reversing the 9.3% growth in April. Overall NODX to six of Singapore's top 10 trade partners declined in May 2025, with falls in shipments to the US, Thailand, and Malaysia, while those to Taiwan, Indonesia, South Korea, and Hong Kong increased. Singapore is a leading petrochemical manufacturer and exporter in southeast Asia, with more than 100 international chemical companies, including ExxonMobil and Aster Chemicals & Energy, based at its Jurong Island hub. ($1 = S$1.28)

17-Jun-2025

This article reflects the personal views of the author and is not necessarily an expression of ICIS's position LONDON (ICIS)–In his latest article about Europe's position in our world of escalating military tensions and warfare director of Eurointelligence Wolfgang Munchau cited US chess player Bobby Fischer as saying: “Tactics flow from a superior position.” Munchau is positing that Europe is increasingly using 'tactics' as opposed to 'strategy'. His argument rings very true when it comes to Europe's energy policy and its stance towards Russia – the aggressor in the brutal Ukraine war that has now lasted for three years. The European Commission has recently announced the 18th sanctions package against Russia aimed at hitting its president Vladimir Putin where it hurts – energy exports – one of his main sources of income. “Russia's goal is not peace, it is to impose the rule of might. Therefore, we are ramping up pressure on Russia. Because strength is the only language that Russia will understand,” President of the European Commission Ursula von der Leyen and High Representative of the Union for Foreign Affairs and Security Policy/Vice-President of the European Commission (HR/VP) Kaja Kallas said in a joint statement on 10 June. To back up its strong words with actions the Commission is proposing a transaction ban for the sabotaged Nord Stream 1 and 2 pipelines that have been inactive since September 2022. "This means that no EU operator will be able to engage directly or indirectly in any transactions regarding the Nord Stream pipelines. There is no return to the past," the Commission's high officials said. The proposal to sanction Nord Stream 1&2 has puzzled many energy experts. "So, why is now Europe rushing to sanction these pipelines, which have not transported gas in almost three years?" asked postdoctoral fellow and energy observer Francesco Sassi. The measure is linked to EU’s Roadmap to phase out all imports of Russian energy by 2027, which it believes will help to end the war in Ukraine. “Every sanction weakens Russia's ability to fight. So, Russia wants us to believe that they can continue this war forever. This is simply not true,” Kallas said. The Commission may achieve its goal of inflicting financial pain on Putin’s war economy. But its rejection of Russian energy should be viewed in the wider context of Europe’s obsession with phasing out fossil fuels as such and its headlong pursuit of Net Zero goals and policies. Net Zero recently came under fire from the most unlikely critic – former British Prime Minister Tony Blair. “Despite the past 15 years seeing an explosion in renewable energy and despite electric vehicles becoming the fastest-growing sector of the vehicle market, with China leading the way in both, production of fossil fuels and demand for them has risen, not fallen, and is set to rise further up to 2030,” Blair said. “Leaving aside oil and gas, in 2024 China initiated construction on 95 gigawatts of new coal-fired energy, which is almost as much as the total current energy output from coal of all of Europe put together. Meanwhile, India recently announced they had reached the milestone of 1 billion tonnes of coal production in a single year,” he added. Blair concluded that any strategy based on “either “phasing out” fossil fuels in the short term or limiting consumption is a strategy doomed to fail”. In the past few years, it has become abundantly clear that European industries have been severely hurt by high energy prices to the point when they are closing down production and relocating to more industry-friendly parts of the world. When it comes to natural gas, Ukraine itself is struggling to secure adequate supplies for this winter, which is putting further upwards pressure on European hub prices and increasing Europe’s appetite for LNG, drawing cargoes away from other continents. So whose interests is the European Commission defending? And whom is it hurting the most? “We Westerners are, by our inclination, more tactical than strategic. We like to close in. That is not necessarily a bad thing, for as long as you have an underlying strategy in place,” Munchau concluded his analysis. Coming back to Bobby Fisher, what position of ‘superiority’ can Europe boast these days? If it is not an economic one, the rest is an empty moral posturing.

16-Jun-2025

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 13 June. ESA ’25: Global sulphuric acid market seeking clarity on H2 supply securityOffer pricing remains stable-to-firm across the global sulphuric acid market as Q2 nears its end – although market players’ views are sharply divided on the supply outlook for the second half of 2025. Europe PS and EPS markets face long supply as demand remains stableEuropean polystyrene (PS) and expandable polystyrene (EPS) markets are navigating a landscape characterized by long supply conditions and stable demand, which is expected to continue unchanged into Q3. Verbio to start up renewable chemicals plant next yearVerbio’s ethenolysis plant under construction in Germany is expected to start up in 2026, a company official told ICIS. Europe June epoxy stable to soft; summer could weigh on pricesEurope epoxy resins price discussions have been relatively stable for June so far,  but with some softening here and there, with ongoing margin challenges counterbalanced by subdued fundamentals. European jet fuel prices extend gains as demand recovers, capping supply dragEuropean jet fuel prices extended gains in the week to 11 June in response to a pick up in buying interest as seasonal demand gets underway. Markets slump, oil soars in wake of Iran strikesEurope chemicals stocks and equities markets fell in morning trading on Friday in the wake of Israel’s missile strikes across Iran, including nuclear facilities, with the prospect of additional attacks chilling sentiment.

16-Jun-2025