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Ethylene07-Jul-2024
HOUSTON (ICIS)–Tropical storm Beryl is
expected to make landfall by Monday between
Corpus Christi and Freeport, Texas, the homes
to several chemical plants and refineries as
well as two of the nation’s major terminals
that export liquefied natural gas (LNG).
Tropical storm Beryl is 195 miles (315 km),
south southeast of Matagorda Bay, with maximum
sustained winds of 65 miles/hour, according to
the National Hurricane Center. It should become
a hurricane later on Sunday and continue
strengthening before making landfall by early
Monday in the middle of the Texas Gulf Coast.
The following map shows the forecasts path of
Beryl.
Source: National Hurricane Center
BERYL THREATENS PETCHEMS, LNG
TERMINALSPetrochemical plants
and complexes as well as refineries, LNG
terminals and oil-exporting operations are with
the center’s hurricane watch zone, which
includes Corpus Christi, Victoria and Freeport.
The rest of the Texas coast is subject to a
tropical storm warning.
Corpus Christi is home to petrochemical plants,
refineries, an LNG terminal and major crude oil
exporting operations.
Freeport is home to an LNG terminal and several
petrochemical plants, including Dow’s major
complex.
PORT OPERATIONS
THREATENEDThe National Hurricane
Center also issued a storm surge warning that
covers Corpus Christi Bay, Matagorda Bay and
Galveston Bay.
In regards to US oil and gas production in the
Gulf of Mexico the Bureau of Safety and
Environmental Enforcement (BSEE) has not issued
any reports.
Thumbnail shows Beryl. Image by National
Hurricane Center.
Ethylene05-Jul-2024
SAO PAULO (ICIS)–Hurricane Beryl is expected
to post a “slow re-intensification” as it heads
towards the north and could potentially hit
Texas’ industrial hub of Corpus Christi by
Monday.
On 4 July, the US National Hurricane Center had
said Beryl
had weakened from a category 5 hurricane to
a category 3 and was expected to become a storm
thereafter.
However, on Friday, as the Hurricane brought
havoc to Yucatan, the NHC said it could
strengthen again once it hits sea waters,
making it stronger as it heads to make another
landfall in Texas.
“Beryl is expected to emerge over the
southwestern Gulf of Mexico tonight and then
move northwestward toward northeastern Mexico
and southern Texas by the end of the weekend,”
said the NHC on Friday morning.
“Maximum sustained winds have decreased to near
85 mph (140 km/h) with higher gusts. Continued
rapid weakening is expected as Beryl moves
farther inland and crosses the Yucatan
Peninsula today, but slow re-intensification is
expected once Beryl moves back over the Gulf of
Mexico.”
Moreover, the Houston area – an
eight-million-strong metropolitan area – could
also now be subject to a significant impact,
although analysts at Space City Weather said on
Friday the impact “will be mostly manageable
locally”.
PETROCHEMICALS,
ENERGYWhile the Altamira
petrochemicals hub in the Mexican state of
Tamaulipas was
spare from the worse, industrial assets in
Texas may not have the same luck.
The current pathway projected by the NHC
implies that Beryl would make landfall in Texas
right in the Corpus Christi area, where major
refining and petrochemical assets are located.
In addition to being a refining and
petrochemical hub, Corpus Christi is a major
oil-exporting port and hosts a terminal that
exports liquefied natural gas (LNG).
If Beryl finally disrupts US LNG exports, that
could have a knock-on effect on petrochemical
prices by shutting down one of the eight LNG
export terminals in the country. If the
disruption lasted long enough, prices for
natural gas would fall.
Lower gas prices would drag down those for
ethane, the main feedstock that US crackers use
to produce ethylene.
Petrochemical producers could benefit from
lower feedstock costs.
Meanwhile, as Beryl strengthens again, energy
companies in Texas may choose to shut their
plants as a precaution, as well as oil and gas
wells in the Gulf of Mexico.
Major US oil and liquefied natural gas (LNG)
ports could also be touched by Beryl now, which
could potentially cause major disruption in
supplies.
THE WEEKEND IS KEYSpace
City Weather said that where Beryl ultimately
makes landfall will depend on how far the
high-pressure system is over the southern US
retreats.
The landfall location is “complicated by the
contour of the South Texas coastline, which is
very nearly north-south relative” to the Gulf
of Mexico.
“Regarding Houston, I would love to be able to
tell you with certainty that Beryl will make
landfall near or south of Corpus Christi. I
truly think that will be the case. But as
Beryl’s track has moved significantly in the
last 24 hours that is not something I can
guarantee you,” concluded analyst Eric Berger.
Source: US National
Hurricane Center
Recycled Polyethylene Terephthalate05-Jul-2024
LONDON (ICIS)–Senior editor for recycling Matt
Tudball discusses the latest developments in
the European recycled polyethylene
terephthalate (R-PET) market, including:
Rises on the low end of colourless flake
narrows UK, eastern Europe ranges
Colourless, blue bale prices rise in
Italian monthly auctions
Increased bale supply, tighter PET, cheaper
R-PET imports
Global News + ICIS Chemical Business (ICB)
See the full picture, with unlimited access to ICIS chemicals news across all markets and regions, plus ICB, the industry-leading magazine for the chemicals industry.
Crude Oil05-Jul-2024
SINGAPORE (ICIS)–Energy major Shell on Friday
said that it expects to book $2 billion in
post-tax impairments following the sale of its
Singapore assets and the suspension of
construction at its biofuels plant in the
Netherlands.
The sale of the company’s Singapore Energy and
Chemicals Park announced in May will result in
a non-cash, post-tax impairment of $600 million
to $800 million when it publishes its
second-quarter results on 1 August, the company
said in a statement.
Shell reached an agreement to sell the assets
on Singapore’s Pulau Bukom and Jurong Island to
CAPGC, a joint venture between Indonesia’s
Chandra Asri Capital and global commodities
trader Glencore.
The sale is expected to be finalized by the end
of 2024.
Meanwhile, the temporarily paused on-site
construction work at its 820,000 tonne/year
biofuels facility at the Shell Energy and
Chemicals Park Rotterdam will result in an
impairment of between $600 million and $1
billion.
The facility is designed to produce sustainable
aviation fuel (SAF) and renewable diesel made
from waste.
Separately, the company said that it expects
adjusted earnings at its chemicals unit “to be
close to break-even” in the second quarter
after posting negative adjusted earnings of
$113 million in the first quarter.
The company expects an indicative chemicals
margin of $155/tonne for the second quarter, up
from $150/tonne in the first quarter and
$153/tonne in the same period of last year.
Chemicals utilization for the second quarter is
expected to be at 78% to 82%, up from 73% in
the first three months of 2024.
Thumbnail photo source: Shell
Polyethylene05-Jul-2024
SINGAPORE (ICIS)–Click here to see the
latest blog post on Asian Chemical Connections
by John Richardson: China’s polypropylene (PP)
exports in 2024, based on the January-May
trends, could reach 2.6m tonnes. That would be
double the level of 2023.
And as exports surge, China’s self-sufficiency
in PP looks set to see a similar dramatic
increase. As recently as 2019, China’s PP net
imports (imports minus exports) totalled 4.8m
tonnes. If the January-May 2024 again
continued, we would see full-year net imports
of just 900,000 tonnes.
Don’t say I didn’t warn you. In September 2021,
the blog started to flag up the declines in
Chinese PP demand growth combined with the
surge in local capacity that created the very
real prospect of China becoming a net exporter.
And don’t assume that if China’s exports won’t
remain in lower value homopolymer grades. China
is said to be tripling its number of grades as
it broadens its licensing of technologies.
But in this ever-more muddle world, now that
the Petrochemicals Supercycle is over,
what is described above is just one scenario.
In the short term, rising container freight
rates might limit Chinese exports over the next
few months. Or at the very least, we could see
China’s exports focused more on southeast Asia
because of higher freight rates to other
destinations such as south Asia, South America
and Africa.
Another feature of a PP world turned upside
down is that since 2020, China’s PP exports
have been sent to a far wider range of
destinations.
We must also consider the impact of rising
protectionism on China’s exports both in the
short -and long-term.
Confused? You should be, as this is the only
sensible response.
How do we see through the muddle? What recent
history teaches us is that to understand
petrochemicals markets, you must follow debts,
demographics and geopolitics.
Equally important, now that the
Petrochemical Supercycle is over, are
the effects of sustainability and climate
change on demand and trade flows. The old ways
of looking at markets no longer work.
In the absence of a 100% accurate crystal ball,
and with all these variables in play, the only
sensible approach is broader and deeper
scenario planning.
Editor’s note: This blog post is an opinion
piece. The views expressed are those of the
author, and do not necessarily represent those
of ICIS.
Ethylene04-Jul-2024
SAO PAULO (ICIS)–The UK’s public broadcaster
BBC was predicting a landslide victory for the
center-left Labour Party after polling stations
closed at 22.00 local time in London.
According to the BBC exit poll, Labour would
have won around 410 members of parliament (MPs)
in the 650-strong House of Commons, with its
leader Keir Starmer set to be the UK’s next
Prime Minister.
Incumbent Prime Minister Rishi Sunak’s
Conservative party lost the overall majority
won in 2019, suffering a severe defeat after
losing more than 200 MPs.
If the BBC exit poll is confirmed, the new
House of Commons would be a more plural
parliament, with the centrist Liberal-Democrats
recovering much ground and the far-left Green
Party and the far-right Reform party having
achieved some meaningful representation.
Earlier in 2024, the UK’s chemicals trade group
the CIA
said the upcoming cabinet must do more to
encourage investment in manufacturing value
chains, arguing the country is losing out in
the battle to attract investment against
competitors such as the EU, the US and China.
14 YEARS LATERLabour
last occupied office in 2010 under the
premiership of Gordon Brown, who succeeded Tony
Blair in 2007.
From 2010 on, Conservative leaders David
Cameron, Theresa May, Boris Johnson, Liz Truss
and Rishi Sunak have been the residents of
Number 10 Downing Street, the official
residence of the Prime Minister in central
London.
Behind them, a convulse decade-and-a-half in UK
politics when voters decided by a small margin
to withdraw from the EU in 2016, a process
which was not concluded until 2021.
From 2020 on, pandemic-related mismanagement
and the energy crisis have kept the governing
party trailing in opinion polls.
On Thursday’s election, several ministers and
key Conservatives figures would have lost their
seat in parliament, according to the BBC’s exit
poll.
UK House of Commons
Projections 2024 – BBC
Election 2019
Change
Conservative Party
131
365
-234
Labour Party
410
203
+207
Scottish National Party
10
48
-38
Liberal-Democrats
61
11
+50
Others
38
23
+15
Ethylene04-Jul-2024
SAO PAULO (ICISI)–Fears that Hurricane Beryl
could cause widespread disruption to
petrochemicals production in the Altamira hub,
in the Mexican state of Tamaulipas, have now
subsided as the hurricane weakens on its path
through the Caribbean.
Beryl was a powerful Category 5 hurricane until
a few hours ago but has quickly weakened to a
Category 3 as it heads towards the Mexican
peninsula of Yucatan.
After that, it is expected to weaken further
and reach Tamaulipas and the US state of Texas
a storm, much less destructive and not a cause
of concern for industrial assets in those
regions.
A spokesperson for Alpek, one of Mexico’s main
chemicals producers, said Beryl is now expected
to only cause manageable rainfall in Altamira;
that rainfall will be very much welcome after
the area suffered a severe drought for months.
“At the moment, the prediction is that it will
only rain in Altamira [when Beryl passes
through] and we do not expect it to have an
impact in our operations,” said a spokesperson
for Alpek.
The petrochemicals hub in Altamira also hosts
companies such Orbia, Dynasol, Cabot, or
Chemours, among many others.
None of the producers mentioned had responded
to a request for comment at the time of
writing.
FROM DROUGHT TO RAINY
SEASONAltamira’s petrochemicals
players had been struggling with water
restrictions for industrial players since May,
when a severe drought in Tamaulipas prompted
the authorities to restrict water supplies.
The situation caused widespread disruption to
chemicals production; in mid-June, it
started improving as
water supplies to households, first, and to
industrial players later were re-established.
The fact that Beryl is expected to cause only
rainfall, without risk of flooding, will also
be welcome.
In an interview with ICIS
in mid-June, an expert from supply chain
consultancy Everstreams said that, while much
awaited, rainfall in the form of storms or
hurricanes could cause as much havoc as the
drought had caused.
“With flooding, there is potential for things
like landslides and run-offs, which can block
roads and highways, So, companies are hoping
that it will be some kind of happy middle
ground, where the rain is not too extreme as to
present added challenges and issues,” said
Everstreams’ Jena Santoro.
Earlier on Thursday, the US’ National Hurricane Center
(NHC) said Beryl should hit northern Mexico
and southern US as a storm, which would spare
industrial assets in those regions – including
several petrochemicals hubs as well as
refineries – from a big hit to operations.
BUSY HURRICANE
SEASONMeteorologists have warned
that this year’s hurricane season could
be the most active ever, with 17-25 named
storms.
Out of those, between eight and 13 are expected
to be hurricanes; between four and seven should
be major hurricanes.
Major hurricanes are Category 3-5 storms with
wind speeds of at least 111 miles/hour.
Beryl’s unprecedented early development into a
Category 5 hurricane has been attributed to
unusually warm sea temperatures, a consequence
of global heating.
Source: US National
Hurricane Center
Ethylene04-Jul-2024
SAO PAULO (ICIS)–Hurricane Beryl, which until
3 July was a powerful Category 5 hurricane,
weakened to Category 3 by Thursday morning as
it headed towards the Mexican peninsula of
Yucatan.
When it hits Yucatan, Beryl is expected to
weaken into a storm, the US National Hurricane
Center (NHC) said on Thursday morning.
Therefore, industrial assets in northern Mexico
and Texas – including several petrochemicals
hubs as well as refineries – could be spared
from a big impact if the forecasted path holds.
In addition, few if any energy companies may
choose to shut in US oil and gas wells in the
Gulf of Mexico.
Major US oil and LNG ports are also expected to
avoid the worst of the storm. According to the
current forecast, the hurricane will make
landfall between the Mexican petrochemical hub
of Altamira, Tamaulipas, and the US hub of
Corpus Christi, Texas.
“A westward to west-northwestward motion is
expected during the next day or two, taking the
core of Beryl away from the Cayman Islands
through this afternoon and over the Yucatan
Peninsula early Friday. Beryl is expected to
emerge over the southwestern Gulf of Mexico
Friday night and move northwestward across the
southwestern Gulf of Mexico on Saturday,” said
the NHC.
“Reports from Air Force Reserve and NOAA
[National Oceanic and Atmospheric
Administration] Hurricane Hunter aircraft
indicate that maximum sustained winds are now
near 115 mph (185 km/h) with higher
gusts. Beryl is a category 3 hurricane on
the Saffir-Simpson Hurricane Wind Scale.
Weakening is forecast during the next day or
two, though Beryl is forecast to remain a
hurricane until it makes landfall on the
Yucatan Peninsula.”
BUSY HURRICANE SEASON
Meteorologists have warned that this year’s
hurricane season could
be the most active ever, with 17-25 named
storms.
Out of those, eight-13 should be hurricanes and
four-seven should be major hurricanes.
Major hurricanes are Category 3-5 storms with
wind speeds of at least 111 miles/hour.
Beryl’s unprecedented early development into a
Category 5 hurricane has been attributed to
unusually warm sea temperatures, a consequence
of global heating.
Source: US’
National Hurricane Center
Gas04-Jul-2024
LONDON (ICIS)–The surge of populist far-right
movements in recent EU and national elections
are raising questions about the bloc’s ability
to retain its role as the world’s climate
policy pioneer.
Many consumers are demanding a focus shift from
climate targets to competitiveness and
security.
While these goals may gather momentum, Europe’s
ambition to phase out fossil fuels to achieve
climate neutrality will remain firmly on the
political agenda.
Nevertheless, the speed of implementing
legislation or reaching stringent targets will
depend on four key factors.
Read the full ICIS white paper
here .
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