1. Exploding distillate glut
- U.S. distillate stocks are soaring, jumping from 136 million barrels in mid-April to 174 million barrels at the end of May.
- Distillate stocks are only 1 percent below a record high last reached in 2010.
- “The latest inventory build happened even more quickly than during the 2008/09 economic crisis, as stocks soared now by 52 million barrels, i.e. 43%, in just two months,” Commerzbank said in a note. “This is attributable first and foremost to extremely weak demand, which at 2.7 million barrels per day has fallen to its lowest level since April 1999.”
- At the start of the pandemic, it was gasoline that was dragging down refiners. Now it is diesel and other distillates.
- Cracks for diesel in Europe have collapsed to an all-time low. “The situation looks awful,” an executive at a big European refiner told Reuters.
2. Petrochemical sector facing a bust
- The oil majors have made a large bet on plastics and petrochemicals as a hedge against long-term demand. But the market for polyethylene is facing overcapacity and narrowing margins.
- The buildout of petrochemical facilities in the U.S. over the past decade has led to a wave of new facilities, but prices for polyethylene – the building block of plastic – have nosedived.
- PE prices traded at about $1 per ton in 2011-2012 when Royal Dutch Shell (NYSE: RDS.A) planned its petrochemical…
"oil" - Google News
June 06, 2020 at 12:32AM
https://ift.tt/3eUXxSu
The Big Oil Bet That Went Bad - OilPrice.com
"oil" - Google News
https://ift.tt/2PqPpxF
Shoes Man Tutorial
Pos News Update
Meme Update
Korean Entertainment News
Japan News Update
Bagikan Berita Ini
0 Response to "The Big Oil Bet That Went Bad - OilPrice.com"
Post a Comment