TORONTO (ICIS)–Canada’s new prime minister, Mark Carney, will focus on diversifying the country’s trade relationships and improving its security, he said on Friday after officially taking over from Justin Trudeau. The new government’s top priority would be “protecting Canadian workers and their families in the face of unjustified foreign trade action”, he said with reference to the US tariffs on goods from Canada. Canada would be “building here at home” to become stronger while working “with different partners” abroad, he said. Carney plans to travel to France and the UK next week to talk about trade diversification and security with European leaders, he said. Although he has no immediate plan to meet US President Donald Trump, Carney was looking forward to speaking with Trump “at the appropriate moment”, he said. Canada joining the USCarney explicitly rejected Trump’s repeated suggestions that Canada should join the US as its 51st state. Following a G7 foreign ministers meeting in La Malbaie in Canada’s Quebec province on Friday, US Secretary of State Marco Rubio told reporters that Trump’s position is that Canada would be better off joining the US “for economic purposes.” Asked about these remarks, Carney said: “It’s crazy, [Trump’s] point is crazy, that’s it.” “We will never, ever, in any shape or form, be part of the United States”, he said. Regarding the trade conflict, Carney reminded that Canada was the largest client of the US in many industries. “We respect the United States, we respect President Trump”, he said. Canada understood Trump’s priority to address “the scourge of fentanyl”, which was also a problem in Canada. It also understood the importance Trump places on American workers and jobs, Carney said and went on to say: “We want him [Trump], and his administration, to understand the importance we put on Canadian workers and jobs”. Carney noted that Trump was a “successful businessman and deal maker”, and he expressed the hope that the US will understand Canada’s position. As for Canada’s consumer carbon tax, Carney said that the new government would move quickly to abolish it. Carney said previously he would retain Canada’s industrial carbon pricing. Carbon pricing has been important in attracting investments in low-carbon projects, led by Dow’s Path2Zero petrochemicals complex under construction in Alberta province. He did not say when he will call an election. Carney, who is a former governor of the Bank of England and the Bank of Canada, does not have a seat in parliament. In the wake of Trudeau’s resignation announcement on 6 January and the trade conflict with the US, Carney’s Liberal Party has caught up with the opposition Conservatives in opinion polls about the next federal election. Elections must be held before the end of October. Please also visit US tariffs, policy – impact on chemicals and energy Thumbnail photo of Canadian Prime Minister Mark Carney; source: Liberal Party of Canada

The following text is from a white paper published by ICIS called Trump peace talks bring further uncertainty over Russian oil and LNG sanctions. You can download the pdf version of this paper here. Written by: Aura Sabadus, Barney Gray, Andreas Schroeder, Rob Songer As US president Donald Trump pushes for Ukrainian-Russian peace negotiations, it is uncertain whether he might seek to strengthen or unwind some of the sanctions imposed on Russian oil and LNG over the last three years. Trump has also been pursuing a blend of tariffs and sanctions, complicating an already difficult landscape. This latest ICIS paper proposes to help companies navigate a complex environment, reviewing the impact of new tariffs and existing sanctions on markets, the likelihood that they may be scrapped and asks whether unilateral European sanctions on Russian oil and gas could be just as effective.  INTRODUCTION US President Donald Trump’s second term has ushered in a whirlwind of economic measures sparking volatility across markets and shaking the global economy. Since his return to power at the end of January, US trade policies have focused on a blend of tariffs and sanctions targeting import partners, Canada and Mexico but also political adversaries, Iran and Venezuela. From this vantage point, his wider economic measures have the potential to spur inflation and a global economic slowdown that could weaken energy demand at a time of surging global oil and gas supply, weighing heavily on prices. With events unfolding at rapid speed as policies are announced and rolled back within days or even hours, it is becoming increasingly difficult for companies to assess the direction that oil and gas markets will take in the longer-term. Perhaps the biggest wild card in this unpredictable environment is the US’ position on Russian oil and LNG sanctions. On 7 March, the US president said he was strongly considering an array of tariffs and sanctions on Russia but many observers do not exclude the possibility of a u-turn on restrictions as Washington has been doubling down on efforts to conclude a peace deal with Moscow over Ukraine. These sanctions could be eased either during peace negotiations or once the war ends. SANCTIONS AND LOOPHOLES Since Russia invaded Ukraine in February 2022, the US together with the EU and the UK imposed over 20,000 sanctions, targeting primarily its oil sector. Nevertheless, despite the sweeping sanctions, Russia still made close to €1tr in oil and gas sales since the start of the war, as the two account for up to half of Russia’s tax revenues, according to estimates from the Centre for Research on Energy and Clean Air (CREA). Although the US and the EU introduced limited restrictions on Russian LNG, the country lost most of its European pipeline gas market share after cutting close to 80% of its exports following the invasion of Ukraine. Following the expiry of the Russian-Ukrainian pipeline gas transit agreement at the beginning of 2025, the Russian share of LNG and gas in Europe is 11%. Since then, the shortfall has been plugged primarily by the US, which now accounts for nearly a quarter of European gas supplies. RECORD IMPORTS In January alone, a record 58% of LNG imported into Europe came from the US, while Russia’s market share including pipeline and LNG exports accounted for 11%, dropping from close to 40% in 2021. While Europe has become increasingly dependent on the US, the same could be said about the US, as 80% of its LNG exports have been heading to Europe in recent months, according to ICIS data. With US LNG production set to double in the second half of this decade, unwinding sanctions against Russia’s Arctic LNG2 project would create direct competition to US producers. In contrast, by removing some of the sanctions on the oil sector, the Trump administration might hope to offset the inflationary effect of tariffs through falling oil prices and greenlight the return of US companies to Russia. Meanwhile, with the EU and the UK pledging to weaken Russia economically as part of efforts to help Ukraine negotiate from a position of strength, the onus would be on Brussels and London to continue sanctions on their own but that raises questions about their effectiveness. An EU transshipment ban prohibiting the transfer of Russian LNG via European terminals could have the perverse impact of redirecting these LNG volumes into European markets when it comes in force at the end of this month. Last year, more than 50% of Russian LNG exports ended up in Europe, which means that with the trans-shipment ban even more volumes could enter the market just as the EU is preparing to announce a roadmap for the scheduled 2027 Russia fossil fuel import phaseout. TARIFFS Donald Trump’s administration has had a profound impact on the global crude market in only a few short weeks. His mix of tariffs on friendly countries and sanctions on adversaries have led to ramped-up volatility and uncertainty with a distinct bearish tinge. Tariffs against Canada and Mexico announced in February, paused for a month and reintroduced in March only to be suspended again, have sparked fears of a global trade war. Canada is the US’ largest source of imported crude, representing over 4 million barrels/day or 62% of total imports in 2024. US refiners rely on Canada’s heavier, sour grades for which many US Gulf Coast refiners are specifically adapted to process. The US has placed a tariff of 10% on Canadian imports, adding more than $5/barrel to the current cost of Canada’s Western Canadian Select export grade. This will adversely impact refiners’ margins and may encourage them to seek replacement barrels from overseas, boosting demand for non-tariffed Middle Eastern or Brazilian grades. While the majority of Canada’s export pipeline infrastructure is dedicated to serving US customers, Canada is likely to ramp up exports through its Trans Mountain pipeline on the Pacific coast targeting Asian customers. Such a move could compete with Middle Eastern exports to Asia as higher volumes of Canadian grades find their way to South Korea, China and Japan. US tariffs on Mexican imports are a more punitive 25%, impacting around 465,000 barrels/day. While Mexican imports could dip in the short term, most Mexican production is coastal and offshore, and the country has the option to reroute exports more readily than Canada. However, with Mexico’s OPEC+ partners starting to return 2.2 million barrels of production cuts to the market over the next 18 months from April, surplus Mexican oil on the global market is likely to pressure prices. Meanwhile, with OPEC+ seeking to increase monthly production by around 138,000 barrels per day, US sanctions will try to remove supply from Iran. Iranian production dipped sharply under Trump’s first term only to rally again during president Biden’s tenure to 3.26 million barrels/day in 2024. While US sanctions could pare this back by 1.0 million barrels/day, offsetting global supply gains elsewhere, it is likely that this number is optimistic as consumers in China and India continue to ignore US sanctions on Iran. The US is likely to be more successful sanctioning Venezuelan imports which currently average around 220,000 barrels/day. Since Trump cancelled Chevron’s license to operate in the country, imports of Venezuelan oil are now likely to cease completely with these barrels competing in the global heavy, sour market. RUSSIAN SANCTIONS US president Donald Trump’s tariffs and sanctions policies so far this year have weakened oil prices. These policies, along with likely increased supply of competing grades from Canada, Mexico and the Middle East, mean medium and heavy-sour benchmark oil prices could weaken even further this year. One implication is that president Trump may sacrifice the growth of the US oil sector for lower oil prices as a net benefit to the US economy. Should he also relax sanctions on Russia, the prospect of up to 0.6 million barrels/day of spare capacity hitting the market comes closer to reality, which could tank prices. What decision the Trump administration takes regarding Russian oil and gas will be pivotal for global markets, determining not only immediate price movements but also the long-term direction of the industry. Recent diplomatic events suggest the US is sympathetic to Moscow’s cause, as it pushes for an immediate peace deal with Ukraine. Many observers say that lifting sanctions could be detrimental to US oil and LNG producers and could have major oil price downside. Since the start of Russia’s full-scale invasion of Ukraine, western partners, including the US, UK and the EU have introduced over 20,000 sanctions against Russia, expecting to dissuade it from pursuing its aggression against Ukraine. Most of these sanctions target its oil and LNG sectors, which account for more than a third of Russia’s annual revenue. They took the form of either sanctions on production and services, or a price cap designed to limit revenue while not creating global supply imbalances. These were bolstered by a comprehensive package introduced in the final days of the previous Biden administration, directed at 183 oil tankers, some of which overlap with the 90 vessels blacklisted by the UK and another 80 sanctioned by the EU. Since the G7 plus Australia introduced a $60/bbl cap on the price for seaborne Russian-origin crude oil, prohibiting service providers in their jurisdictions to enable maritime transportation above that level, Russia has built a shadow fleet of tankers stripped of ownership, management and flagship to help circumvent the restrictions. It spent over $10 billion in acquiring the vessels and is thought to have earned around $14 billion in sales, according to CREA. CREA also noted the comprehensive sanctions on oil production might cut up to $20 billion from Russia’s oil and gas revenue forecast of $110 billion this year. Following tougher US sanctions introduced earlier this year, India and China halted the purchase of Russian oil.  But the effectiveness of sanctions lies not only in their enforcement but also in the perception that they would be imposed. With Donald Trump driving the US increasingly towards Russia, that perception will be diluted, raising questions about the effectiveness of the sanctions in the longer-term. LNG SANCTIONS To date, the most wide-reaching sanctions to be imposed on Russian LNG ships and infrastructure have been through the US treasury. The most significant European sanctions, clamping down on LNG ship-to-ship (STS) transfers in European ports, come into effect at the end of March and are intended to reduce Russia’s ability to supply its Arctic LNG to markets outside Europe. However, they could result in increasing European imports of Russian LNG, since less will be able to be exported. To minimize disruption to the US’s European allies, US treasury sanctions did not target the established 17.4 million tonne per annum (mtpa) Yamal LNG and 10.9mtpa Sakhalin 2 liquefaction plants. Nor did they initially target much Russian shipping, although this soon followed. HITTING LNG PRODUCTION Instead, measures were aimed squarely at the 19.8mtpa Arctic LNG2 (ALNG2) liquefaction plant, which was sanctioned before it had loaded a commercial cargo, as were two giant brand-new floating storage units (FSUs), each with a storage capacity of 362,000cbm. These two FSUs, named Saam and Koryak, were intended to be installed as storage hubs at Murmansk in Europe, and Kamchatka in Asia, respectively, allowing laden Arc7 ice-class vessels to shuttle cargoes away from icy conditions, so they could be reloaded via STS transfers onto more lightly winterised vessels. In keeping with the theme of sanctions targeting new, rather than existing Russian infrastructure, four newbuilds built by South Korea’s Samsung Heavy Industries (SHI) called North Air, North Way, North Mountain and North Sky were all sanctioned, preventing them from being put to work at the neighbouring Yamal LNG facility. However, four more vessels also intended to perform this role but arriving slightly later from another South Korean shipyard – Hanwha Ocean – have only recently been delivered. As a result, these four vessels – called North Moon, North Light, North Ocean and North Valley –  managed to escape the last of the Biden-era sanctions and are being used for Yamal LNG STS operations. The operator of Arctic LNG2 turned to smaller, older vessels to try to circumvent the loading ban, and these vessels – which were characterized by regular changes to their names, flags and byzantine ownership structures – were also sanctioned. Finally, in January 2025, the outgoing Biden administration slapped sanctions on existing liquefaction plants for the first time, seemingly calculating that their small sizes would not greatly inconvenience buyers. These were the 1.5mtpa Portovaya midscale and 0.66mtpa Vysotsk small-scale liquefaction plants, along with two Russian-owned vessels, the Gazprom-chartered Pskov, since renamed Pearl, and Velikiy Novgorod, which Gazprom used to load Portovaya cargoes. As it stands, some 15 LNG vessels are the subject of US treasury sanctions, according to ICIS LNG Edge, including Saam and Koryak. It should also be noted that less specific sanctions targeting technology transfers have also meant that five Arc-7 carriers that were being completed in Russia’s Zvezda shipyards, their hulls having been built in South Korea by SHI, are yet to be commissioned, two years after they were supposed to be delivered. In addition, a further ten SHI hulls have since been cancelled, which will likely slow down future Arctic LNG projects planned by Russia. Given the Trump administration’s current cordiality to Russia and antagonism towards Ukraine, it seems unlikely at this stage that further sanctions on LNG vessels will be implemented. Instead, it is arguable that existing sanctions now stand more chance of being rolled back. The sanctioned vessels are as follows: UNWINDING SANCTIONS? With the US pivoting towards Russia, there are two questions that will dominate discussions in global oil and gas markets: Will the US unwind the sanctions imposed so far and, if so, can unilateral European sanctions be equally effective? Alexander Kolyandr, a sanctions specialist and non-resident senior fellow at the Washington-based Center for European Policy Analysis (CEPA) said several conditions must be taken into consideration. Firstly, with Trump’s tariff policies likely to lead to inflation that would hit both his blue-collar Rust Belt electorate and tech companies in California, lifting some sanctions on Russian oil production could pressure crude prices, offsetting the impact of tariffs, he said. As steep price falls could hit current and future oil output, such a measure would have to be weighed against the interests of US producers. Kolyandr said the blacklisting of Russian oil companies Gazprom Neft and Surgutneftegas has a relatively minor impact because their combined production is around one million barrels per day, or less than a tenth of Russian overall production. More critical are sanctions against the so-called shadow fleet that has been carrying 78% of Russian seaborne crude oil shipments in in 2024, according to a report by the Centre for Research on Energy and Clean Air (CREA). When EU and UK sanctions are added to those imposed by the US, the number of blacklisted oil tankers increases to 270, around a third of Russia’s shadow fleet. APPROVAL Kolyandr said another factor that will determine the unwinding of US sanctions is ease of removal. “Some sanctions derive from CAATSA (Countering America’s Adversaries Through Sanctions Act), which need Congressional approval and are more difficult to remove and some were introduced through emergency acts, which are easier to unwind,” Kolyandr said. Although sanctions against Russian LNG are limited in scope, the likelihood of removing them, particularly against the Arctic LNG2 project , is lower as adding more LNG to a production glut that is expected to build up in coming months would hit US producers. However, it is unlikely the US Office of Foreign Assets Control (OFAC) will seek to expand the scope of sanctions beyond Arctic LNG2 and the smaller Portovaya and Vysotsk to the bigger Yamal LNG and Sakhalin II exports as these would create major disruptions in a global LNG market set to remain tight in the mid-term. EUROPEAN SANCTIONS If the US did unwind critical sanctions against Russia’s oil and LNG shadow fleets as well as against oil production, could European measures prove as effective? Some observers believe that a possible US exit from the G7 price cap would not pose a problem to Europe because most of the Russian oil dodging the cap is exported via EU-controlled chokepoints in the Baltic Sea, giving the bloc leverage to control and enforce the cap. Russian LNG exports are equally critically dependant on European insurance. In 2024, 95% of LNG volumes were transported on vessels insured in G7 + countries. More than half of these vessels belonged to UK and Greek companies, making them vulnerable to European leverage, according to CREA. Ongoing price volatility and tight market conditions expected for the rest of the year will likely leave the EU unable to join the UK in banning Russian LNG imports, at least for the time being. However, the EU could work with Ukraine to ban remaining land-based oil exports to Hungary, Slovakia and Czechia via the Druzhba pipeline. The expansion of the Transalpine Pipeline from Italy to the Czech Republic could help replace some of the volumes transiting Ukraine. FINANCIAL MARKETS To restart Russian oil and gas operations, western companies would need access to markets, where the major global financial centres of the EU and UK could also exert pressure. On March 13, there were reports that a waiver introduced by former president Joe Biden exempting 12 Russian banks used for oil payments may have lapsed on March 12 without being renewed. As the waiver lapsed, the May Brent future price fell below $70/bbl but regained some of the lost premium the following day to hover around that level. Kolyandr said that in the case of Gazprombank, which had received a separate exemption to allow payments from pipeline gas buyers from Turkey, the waiver may still be on for now. By: Barney Gray, Aura Sabadus, Andreas Schroeder, Rob Songer

LONDON (ICIS)–Senior Editor for Recycling, Matt Tudball, discusses the latest developments in the European recycled polyethylene terephthalate (R-PET) market, including: Colorless flake prices rise in Italy and Spain High feedstock bale costs still a concern Hopes for improved pellet demand from Q2

SINGAPORE (ICIS)–South Korea is initiating full emergency response measures as US steel and aluminum tariffs take effect, aiming to mitigate the impact on its economy, which is already grappling with weak exports and domestic consumption. US reciprocal tariffs, automotive tariffs to bite Hyundai Steel enters emergency mode due to tariff-induced financial strain 2024 export surplus at risk as global tariff war escalates The South Korean Ministry of Trade, Industry and Energy (MOTIE) convened a meeting with stakeholders on 12 March to strategize in response to the US’ newly implemented 25% tariffs on steel and aluminum imports. The MOTIE meeting was organized to “further strengthen the joint public-private emergency response system in preparation for the US administration’s steel and aluminum tariff measures, the anticipated imposition of reciprocal tariffs in early April, and tariffs on specific items such as automobiles”, the ministry said in a statement. “We will further strengthen the response system ahead of the anticipated imposition of reciprocal tariffs in early April and do our utmost to protect the interests of our industry,” industry minister Ahn Duk-geun said. “We will closely conduct high-level and working-level consultations with the US, including the head of the Office of Trade, and monitor the response trends of other major countries to minimize any disadvantages to our industry,” he added. South Korea’s trade minister Cheong In-kyo is currently in the US from 13 to 14 March to discuss trade issues including reciprocal tariffs and investment projects with his counterparts, MOTIE said in a statement on 12 March. Cheong will meet with officials at the US Trade Representative for consultations on the tariff issue, as well as investment plans by South Korean companies in the world’s biggest economy. According to data from the US International Trade Administration (ITA), South Korea was the fourth-largest exporter of steel to the US last year, accounting for 9% of Washington’s steel imports. The northeast Asian country was also the fourth-biggest exporter of aluminum to the US, comprising about 4% of US aluminum imports. Hyundai Steel Co, South Korea’s second-largest steelmaker after POSCO, has entered emergency management mode due to increasing market pressures, local media reported on Friday. The company has implemented a 20% salary reduction for all executives, effective 13 March, according to South Korean news agency Yonhap. Further measures include a review of voluntary retirement options for staff, along with plans to drastically reduce operational expenses, including limiting overseas travel. The US tariffs on all steel imports have significantly worsened the company’s financial outlook, the Korea Times said. EMERGENCY EXPORT MEASURES The South Korean government on 18 February announced emergency export measures consisting of four pillars: tariff responses; a record won (W) 366 trillion ($253 billion) in export financing; export market diversification; and additional marketing and logistics support. South Korea is a major importer of raw materials like crude oil and naphtha, which it uses to produce a variety of petrochemicals, which are then exported. The country is a major exporter of aromatics such as benzene toluene and styrene. Government officials have expressed concern that export conditions are expected to worsen considerably in the first half of the year but improve in the second half, defining the current situation as “an emergency” and “the last opportunity to maintain the export growth momentum”. South Korea achieved record-breaking exports and a trade surplus in 2024, with exports reaching $683.7 billion and the trade balance showing a $51.6 billion surplus. A major concern is increased risks amid the trade protectionist stance of the US under President Donald Trump which could trigger a full-scale global tariff war. In February, South Korea’s export growth inched up 1% year on year to $52.6 billion, accompanied by the first decline in chip exports in 16 months which offset strong automobile and smartphone shipments. “The first half of the year is expected to be particularly difficult for exports due to the convergence of three major challenges: the launch of the new US administration, continued high interest rates and exchange rate volatility, and intensifying competition and oversupply in advanced industries,” according to S Korea’s government ministries. Concerns include falling prices of major export items and a decrease in import demand in key markets as well as expectations of weak oil prices following the end of production cuts by OPEC and its allies (OPEC+) and the US pro-fossil fuel policies. South Korea’s slowing import demand, the US’ increased local production, EU’s electric vehicle market challenges and global contractions in manufacturing and construction markets are also causes for concern. These factors are expected to particularly affect exports of major items such as semiconductors, automobiles, petrochemicals, and machinery in the first half of the year. There are also worries about lower exports in critical sectors due to falling unit prices and oil prices, along with the risk of reduced demand in the US and EU for automobiles and general machinery due to market challenges and the contraction of the construction market. South Korea’s GDP growth this year is projected at 1.5%, down from its previous estimate of 1.9% and lower than the 1.6% to 1.7% range indicated in January. For 2024, South Korea’s final GDP growth was confirmed at 2.0%, matching the preliminary estimate released in January. The economy is experiencing a slowdown in the recovery of domestic demand, including consumption and construction investment, coupled with continued employment difficulties, particularly in vulnerable sectors, according to the Ministry of Economy and Finance’s monthly economic report released in Korean on Friday. “While geopolitical risks persist in the global economy, uncertainties in the trade environment are also expanding, such as the realization of tariff impositions by major countries,” it said. “The government will continue to work hard on supporting exports and responding to uncertainties in the trade environment.” Focus article by Nurluqman Suratman Thumbnail image: Trade cargo containers at Busan port, South Korea – 1 February 2025. (YONHAP/EPA-EFE/Shutterstock)

HOUSTON (ICIS)–The new administration of US President Donald Trump is giving chemical companies a break on regulations and proposing tariffs on the nation’s biggest trade partners and on the world. RELIEF FROM RED TAPEThe new administration marks a sharp break from the previous one of the former president,Joe Biden. He proposed a wave of regulations towards the end of his administration that increased costs while providing little benefit to the chemical industry. Several proposed rules under that previous administration will likely fall by the wayside, said Eric Byer, president and CEO of the Alliance for Chemical Distribution (ACD), a trade group that represents chemical distributors. So far under Trump, the regulatory climate has been mostly positive, Byer said. Trump pledged to reduce regulations, and late in his campaign, said he would purge 10 regulations for every one introduced by his administration. The government is conducting earnest analyses of the economic effects of rules, something that the previous administration had glossed over, Byer said. LESS RIGID ENVIRONMENTAL RULESThe Environmental Protection Agency (EPA) is reviewing how it evaluates existing chemicals for safety under its main program, known as TSCA. Among items it could review is the whole chemical approach that the agency adopted under the previous administration. That approach made it likely that the EPA would determine that a chemical posed an unreasonable risk. Such a finding would expose the chemical to more restrictions. For environmental regulations in general, the EPA announced numerous reviews of existing regulations that could have far-reaching effects on costs. The following lists some of the regulations under review: The National Emission Standards for Hazardous Air Pollutants (NESHAPs). The standards for chemical manufacturing will be among those that the EPA will initially review. The greenhouse gas reporting program. The Risk Management Program (RMP). One RMP rule compromised plant safety by requiring companies to share information that had been off limits since the 9/11 terrorist attacks, according to trade groups. The Technology Transitions Program. Currently, the program restricts the use hydrofluorocarbons (HFCs), which are used to make refrigerants and blowing agents for polyurethanes. Terminating the environmental justice and diversity, environment and inclusion (DEI) arms of the EPA. Environmental justice has made it harder to build chemical plants. Particulate matter national ambient air quality standards (PM 2.5 NAAQS). The review could lead to guidance from the EPA that increases both the flexibility and clarity of permitting obligations for chemical plants, according to the ACC. A rule by the previous administration that intended to account for what it described as the social cost of carbon. The Waters of the US Rule. The EPA wants to review the rule to reduce permitting and compliance costs. ENDING FAVORABLE EV RULESThe EPA is reviewing the tailpipe rule that was adopted by the previous administration. The tailpipe rule gradually reduced the carbon dioxide (CO2) emissions of automobiles. Critics have said that this and other regulations from the previous administration were so strict, they acted as bans on vehicles powered by internal combustion engines (ICE). The EPA will also review the standards for model years 2027 and later light-duty and medium-duty vehicles. The Department of Transportation (DOT) wants to reset the Corporate Average Fuel Economy (CAFE) standards, which critics say unduly favor electric vehicles (EVs) by being too strict. SUPERFUND TAX MAY BE RESCINDEDThe Republican controlled government could repeal the Superfund tax, which was imposed in 2022 on several building-block petrochemicals and their derivatives. Confusion arose over how to calculate the taxes for the derivatives. The government also seems to lack the resources to administer the program. So far, legislators have introduced bills in both legislative chambers that would repeal the tax, including Senate Bill 1195 and House of Representatives Bill 640. These would likely need to be part of a larger tax bill. Byer of the ACD said the repeal will not be easy. However, it does have a chance to succeed, and the effort is getting traction among legislators. The ACD, the ACC and the American Fuel & Petrochemical Manufacturers (AFPM) were among the trade groups that signed a letter urging Congress to repeal the tax. TARIFFS POSE RISK TO CHEMSThe tariffs adopted and being proposed by the US could increase costs of imports of steel and aluminium needed to build new plants and repair existing ones. They also increase the costs of minerals used to make catalysts as well as regional imports of plastics and chemicals. US tariffs also expose its chemical industry to retaliatory tariffs. US tariffs could cause short term logistical disruptions because companies will be re-arranging supply chains to avoid the taxes and to secure materials from new suppliers that could be farther away. “I think we will see some near-term reconfiguration of moving products because of the tariffed countries, predominantly China, Mexico and Canada,” Byer said. “Either way, people will reconfigure. My hope is that the reconfiguration part will only last a few weeks to a few months at most so we can get back to just doing straight on trade deals and supply chain movements without to deal with tariff stuff.” Hosted by the American Fuel & Petrochemical Manufacturers (AFPM), the IPC takes place on 23-25 March in San Antonio, Texas. Insight article by Al Greenwood Thumbnail Photo: US Capitol. (By Lucky-photographer)

Additional reporting by Luka Dimitrov Plans for new 1GW Albanian-Italian power cable will likely help with increasing Italian power demand The project also involves the development of 3GW of renewable capacity in Albania and up to 1GW of new data centers in Italy The interconnector is expected to be completed in 2028 LONDON (ICIS) – A new 1GW subsea power cable between Italy and Albania, expected to come online in 2028, is likely to boost Italian demand in upcoming years, traders told ICIS. “The feasibility study for the project is currently underway and the results will determine its prospects”, the Albanian energy ministry said at the start of March. On 15 January Italy, Albania, and the United Arab Emirates signed a cooperation deal to build a 1GW subsea power cable between Italy and Albania. The deal, valued at more than €1 billion, will connect the Albanian port of Vlore with the Italian region of Puglia, the narrowest point between Albania and Italy. NEW ALBANIAN RENEWABLES The project signed by the three countries includes the development of 3GW of new renewable capacity in Albania, a large part of which is to be exported to Italy via the undersea power cable. On 24 February, the Italian energy company Eni announced it had signed an agreement with the Emirati companies Masdar and TAQA Transmission to be “a preferred off-taker” of the new Albanian renewable energy transmitted to Italy. Hydropower currently accounts for almost all of Albania’s domestic electricity generation. “Albanian power producer KESH is every week looking to buy energy due to low hydro stocks. The new project with renewable build-up will be a game changer for Albania and KESH as it will save costs and boost exports,” a local trader told ICIS. Albania is currently a net importer of electricity, but its increasing renewable capacity and new interconnection with Italy could see it switch to a net exporter in upcoming years, Balkan traders said. Indeed, Albania’s Energy Minister Belinda Balluku claimed on social media that the agreement would “play a significant role in increasing the country’s energy capacities, as well as supporting Albania’s goal of becoming a net exporter”. RISING ITALIAN DEMAND Traders expect the new cable to boost Italian power demand, which is set to rise by 2030 driven by data centers, EV and industrial sector expansion. In 2024, Italy imported a net total of 79.6GW from Greece, 97.5GW from Montenegro, and 67.8GW from Slovenia. In 2025 so far, Italy has continued to import more electricity than it exports to the Balkans. This trend is likely to continue amid rising Italian demand. Italian power demand totaled 312.3TWh in 2024 according to the Italian TSO Terna, and is forecast rise to 355.7TWh by 2030, ICIS analytics shows. Italian data center demand is forecast to nearly double within the same time-period, rising from 3.64TWh in 2024 to 7.01TWh in 2030. In February, Eni also signed a letter of intent with the Emirati groups MGX and G42 to develop data centers in Italy with a planned IT capacity of up to 1GW.

SINGAPORE (ICIS)–Click here to see the latest blog post on Asian Chemical Connections by John Richardson. The 1992–2021 Chemicals Supercycle was driven by unique conditions—China’s rapid expansion, globalization, and a massive, debt-fueled boom. That era is over. The industry now faces structural shifts that will reshape markets for decades. What’s different this time? Trade wars & protectionism – China’s economic slowdown is driving aggressive exports, leading to record antidumping measures on chemicals and polymers. Will the trend continue? Climate change & migration – Gaia Vince’s Nomad Century predicts 1.5 billion climate migrants by 2050. How will this shift global chemicals demand? Changing demand patterns – As industries relocate and cities adapt, will traditional GDP-driven demand forecasting still hold? These aren’t just short-term disruptions—they mark a fundamental shift in global petrochemicals. The companies that understand and adapt will be the ones that thrive. Waiting for a return to the old normal isn’t a strategy. The industry is changing—stay ahead of it. 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.

SINGAPORE (ICIS)–Indonesia will impose antidumping duties (ADDs) on nylon film imports from China, Thailand, and Taiwan. The duties, ranging from rupiah (Rp) 1,254 to Rp31,510 per kilogram (kg) will be in effect for four years from late March, Indonesia’s Ministry of Finance said in a statement on 12 March. The ADDs, the highest of which apply to imports from Taiwan, will start after “10 working days” from 11 March, it said. Dumping of imported nylon film products in Indonesia has led to losses in domestic industry, the finance ministry said. Nylon is utilized in various downstream sectors, including automotive, construction, household appliances and electrical products. ($1 = Rp16,439)

MEXICO CITY (ICIS)–The US plastics sector is hopeful free trade in North America will ultimately prevail as the country renegotiates its trade deal with Canada and Mexico in 2026, according to the chief economist at the trade group Plastics Industry Association (PLASTICS). Perc Pineda, chief economist at the trade group, said the previous renegotiation of the North American trade deal USMCA had been beneficial for the three countries’ plastics sectors, pointing to higher percentage of regionally produced plastics going into the automotive sectors, for example. He added that history is already a guide about what happened in US President Donald Trump’s first term, when tariffs on China were imposed and a considerable number of companies operating there set up subsidiaries in other Asian countries such as Vietnam, which only replaced China as supplier but did not bring production back to the US or North America. All in all, Pineda admitted the current ‘chaos’ in the US trade policy after Trump’s second term started in January is creating uneasiness among plastics companies, but he said the focus should be on the “intent of the message” rather than the “theatrics” of how that message is delivered. Pineda was speaking at the plastics trade fair Plastimagen in Mexico City. USCMA HAS BEEN GOOD – DON’T BREAK ITPineda said the USMCA renegotiation under Trump’s first term, which replaced the previous NAFTA agreement from the 1990s, had caused positive effects on the regional plastics sector, which deepened its interconnectedness – the reason why he said it would be very difficult that the plastics sector ended with no trade agreement at all in the region. “We made progress when we transitioned from NAFTA to USMCA. For instance, we have now higher North American content in automotive trade, rising from 62.5% to 75%. That’s an incentive for higher regional production in Mexico, in Canada, and the US. And that’s good for economic growth,” said Pineda. In fact, he was confident that after the current uncertainty in the US trade policy the renegotiation of the USMCA due in 2026 would keep free trade in plastics after all, just like it happened in the transition from NAFTA. Pinda conceded the current shifts in trade policy coming out of the US – with tariffs being announced then quickly reversed, cancelled, or postponed on several occasions – is putting businesses on edge, as investment plans come into question due to the uncertainty. “This is where the chaos starts, troubling businesses. For instance, imports from Mexico that comply with USMCA would be excluded from the 25% tariff at least for another month [after the initial month suspension in February], meaning there a window for President Claudia Sheinbaum to negotiate,” said Pineda. “I trust USMCA will continue. You cannot convince me otherwise that there’s not going to be a free trade of some kind. I remember the first time I spoke at Plastimagen in 2019 – we’ve been through this before. If history is our guide, we will once again face this challenge.” He added the proximity of Mexico and its relation to the manufacturing activity in automotive, for instance, where up to the 33,000 parts going into a vehicle, a third are plastics, would make an outlook without free trade troubling for that manufacturing sector and many others where trade between the countries is intense. “One good example regarding US trade policy is when it imposed tariffs on China. It prompted a lot of Chinese companies to go to other countries such Vietnam, Cambodia, Laos, Malaysia, or Thailand. [In short time] Vietnam suddenly was in the top 20 in the global plastics ranking, in which they had never been before,” said Pineda. “It’s really a result of the change in trade policy that has shifted production of Chinese companies into subsidiaries in other Asian markets. The US now has a trade deficit in plastics with Vietnam on plastic products.” Pineda was asked how business can adapt to the volatility caused by the decision coming out of the White House nearly daily, in trade policy and practically everything else. “If there’s one thing that I can say is focus on the intent of the message, and don’t be overwhelmed by the theatrics of it. I think the message has always been the same, but it is the messenger that is changing on how he is delivering the message, from hour to hour, day to day, month by month, year by year,” he said. “I am even surprised that even the financial markets [with heavy falls this week] are surprised: this is already something that he announced during his presidential campaign: it is the movie we’ve seen before. There will be fair trade eventually.” Pineda wanted to end with a thankful message, speaking to an overwhelmingly Mexican audience aware that the $800 million/year in Mexican plastics exports to the US could be hit hard if tariffs are imposed, according to calculations by the Mexican trade group Anipac. “I’d like to leave the stage by saying, on behalf of the more than 1 million workers in the US plastics industry: thank you very much, Mexico,” he said. “And to the plastics industry in Mexico, I’d like to thank you for sharing your vision and giving us interesting information.” Plastimagen runs on 11-13 March.