• Spot earnings for FY21 dropped down to a loss of R22.51/share this week due to lower oil prices but also the significant decline in crack spreads in recent weeks.  Petrol cracks remain at negative $5.7/bbl, but diesel cracks have now dropped and are close to zero.  The weighted average margin has now also turned negative.
  • Ethylene and derivatives continue to decline in Asia as the cost curve flattens.  Asian naphtha crack spreads have also collapsed and are at negative $5.6/bbl.  Asian and European naphtha crackers are currently at the low end of the cost curve (link).

Global chemical news

  • Global refining outages have surpassed 14 million b/d and are expected to get worse as coronavirus lockdowns sideline up to 25% of global oil demand and storage tanks fill to capacity (link).
  • Chinese polypropylene prices surged in the week as demand for PP fibre for medical protective equipment increased.  Propylene prices were also higher (link).