Podcast by

Pablo Giorgi
Global Olefins

Luka Powell
Financial & Capital Markets

Our podcasts are available on all leading platforms including SoundCloud, Spotify & Apple.

Luka Powell (00:20):

Welcome to the Olefins Weekly Wrap Up. Today is Friday, August 25th, and I’m your host Luka Powell.

Pablo Giorgi (00:28):

And I am Pablo Giorgi.

Luka Powell (00:30):

And together as Chemical Market Analytics, we recap the top events moving the ethylene and propylene markets over the past week. The design of this podcast is to complement the content from the North America Light Olefins Weekly service, otherwise known as the NALO Weekly.

Pablo Giorgi (00:46):

So Luka how are you feeling after the World Cup final? Congratulations to Spain for a great win, England will have to try again next time.

Luka Powell (00:57):

Yes, my optimism is slightly lower. You know where else optimism is lower? The energy markets!

On Thursday, August 25, WTI settled at $79.05 per barrel, down from $80.39 last week. The EIA released crude storage numbers on Wednesday, showing another large reduction at 6.3mm bbls. Cushing also showed a significant drawdown of 3.1mm bbls to 30.7mm, the lowest total in 8 months. This week, the total rig count dropped to 722, the lowest number in 18 months, and a considerable drop from where the year started at 866.

Henry Hub Natural Gas settled at $2.52 per million BTU on Thursday. This week, as quickly as LNG prices came up with the news of the strikes in Australia, they came down again. Prices at the TTF, The Title Transfer facility in The Netherlands, the main LNG benchmark in Europe, increased 60 cents on a weekly average, to 12.35$ per million btu. In the same week last year, prices were 77.60 btu.

Pablo Giorgi (02:11):

Moving to NGLS, Purity ethane prices trended slightly higher this week, from 26.5 cents per gallon last Friday, to 27.3 cents per gallon this Thursday. Ethane frac spreads this week have been around 10 cents per gallon, against natural gas prices.

Non-TET Propane prices also increased this week, from 61.81 cents per gallon last Friday to 65.25 cents per gallon this Thursday. According to the EIA weekly report, the U.S. propane/propylene inventory rose 1.665 million barrels this week to 92.286 million barrels last Friday. The increase was below the expectation of a 2.06 million bbl build. The arbitrage to Asia continues to be wide open.

The Houston-Chiba freight continues to increase, ever so slightly, and is now assessed at $168 per metric ton, despite easing of the waiting times at the Panama Canal, according to our colleagues at OPIS.

That does it for energy, now onto ethylene.

Luka Powell (03:26):

Deals in the US spot market this week totaled 124 million pounds completed at the Texas and Louisiana hubs, a significant increase from last week.

Ethylene prices on a simple average basis increased, ranging between 17.75-18.5 cents per pound (cpp) for August delivery. Ethylene weighted average cash costs are up slightly versus last week but remain below the July weighted average given the spike in ethane prices last month.

An outage at Nova’s Corunna cracker has delayed the startup of their new LLDPE line until September. The severity of the Corunna outage is still being determined. For now, reports indicate that Nova’s Sarnia assets are being run with stored ethylene.

The ethylene forecast changed this week. See the NALO for more information.

That does it for ethylene, now onto propylene.

Pablo Giorgi (04:18):

The US polymer-grade propylene spot market was active this week, with 47 million pounds transacted for August delivery. Prices were relatively stable at around 31 cents per pound, finishing the week at 30.75 cents per pound, despite propane increasing during the week.

The refinery-grade spot market was active this week, with 67.5 thousand barrels done. The 45-day weighted average refinery grade price is now 14.96 cents per pound. All units are operating normally now, after upsets last week brought down 3 PDH units in the USGC. The last of which to come back up was Enterprise’s PDH 2, which started up again last Sunday.

The propylene forecast has not changed this week, see the NALO for more information.

And with that, let’s wrap up the Wrap-Up.

Luka Powell (05:12):

Join us for the First World Chemical Forum in Houston on September 12 to 14. In cooperation with The Wall Street Journal, Barron’s and Factiva, hear from your trusted leading industry experts and industry leaders understand how energy and chemical markets are evolving into a fourth historical, industrial, and social revolution with infinite possibilities, get in-depth insights on geopolitics, climate concerns, shifting trade balances and disruptive technologies, and how that is transforming culture, socioeconomics, and market paradigms.

Pablo Giorgi (05:46):

Don’t forget to subscribe to our podcast on SoundCloud, Spotify, or whatever you get your podcasts and give us a like or leave a review if you enjoy it. And if you have questions or want us to cover something more specific, you can send us an email. Until next time.

Expand Your Reach in the Olefins Markets

Embracing the Infinite Possibilities

Chemical Market Analytics by OPIS, a Dow Jones company, with participation from The Wall Street Journal, Barron’s, and Factiva, presents the 2023 World Chemical Forum, a new event that redefines comprehensive exploration of the future of chemicals and energy, their inter-relationships, and how both markets will address global challenges this century.

Energy and chemical markets are evolving in profound ways and ushering in a fourth historical industrial and social revolution with Infinite Possibilities. Leading global experts and industry executives from all market sectors will convene to hear expert forecasts for key chemical and energy markets and discuss pivotal initiatives including chemical sustainability, the evolving logistics landscape, risk management strategies, and the future impact of Asia on the world.

The comprehensive agenda includes one day dedicated to a global view of the current and future chemical market and two days of guidance on the specific trends shaping the market.

Don’t miss any of it: register now and ensure your attendance at this exciting inaugural event!