- Sasol’s spot earnings continue to decline and FY21 spot earnings is at R3.23/share. Oil prices declined by almost 8% this week and refining margins remain particularly weak. Diesel crack spreads turned negative this week while petrol cracks are at $3/bbl. At spot prices we would expect a loss of R3.74/share at the LCCP.
- Asian chemical prices increased this week and US prices were also sharply higher due to plant closures in Louisiana. US ethylene margins increased to $400/t and integrated polyethylene margins were at $840/t, almost 70% higher than the low point in June (link).
Global chemical news
- LyondellBasell and Liaoning have commenced operations at their 1.1mn naphtha cracking ethylene plant in north eastern China. The facility has 800kt of downstream polyethylene capacity (link).
- Unilever, one of the world’s largest producers of cleaning and laundry products (and presumably a large customer of Sasol’s) announced that will eliminate fossil fuel feedstocks from all cleaning products by 2020 (link).