- Sasol’s spot earnings continue to decline are oil prices and refining margins decline. Diesel cracks in particular are sharply lower this week. FY21 spot earnings are at R4.19/share. At spot prices the LCCP loses around R4.01/share.
- Refining margins remain particularly weak. Monomer prices in Asia increased this week and LDPE prices were slightly higher. In the US, ethylene prices increased as plants shut in due to Hurricane Laura while ethane prices were lower, thereby increasing cracking margins. Polymer prices in the US were generally flat however.
Global chemical news
- Canadian natural gas prices followed US prices higher and are trading at the highest levels in three years according to RBN Energy. Alberta prices were at $2.50/MMBtu (link) and these higher prices should provide some relief at Sasol’s Canadian shale assets.
- Californian lawmakers passed the world’s toughest recycled content for plastic bottles, requiring 25% recycled content in bottles by 2025 and 50% by 2030 (link) Sasol does not produce PET but this highlights the continued pressure to reduce plastic consumption.