Chemicals sector feels the pressure of attacks on oil facilities

The global petrochemical supply chain is braced for the fallout from the weekend attacks on the world’s biggest crude oil processing plant in Saudi Arabia. (Reuters)
Updated 17 September 2019

Chemicals sector feels the pressure of attacks on oil facilities

  • Now petrochemicals industry which relies on crude oil and natural gas to make different kinds of plastic

LONDON: The global petrochemical supply chain is braced for the fallout from the weekend attacks on the world’s biggest crude oil processing plant in Saudi Arabia.

The attacks shut down about 5.7 million barrels per day (bpd) of oil production, sending the price of crude rocketing on Monday. Now the petrochemicals industry which relies on crude oil and natural gas to make different kinds of plastic, is also feeling the impact.

“With associated gas supplies badly disrupted due to the acute pause in oil production after the drone attacks, ethane supply is particularly under threat, which in turn means ethylene supplies would be interrupted too,” said Wood Mackenzie Head of Polyesters Salmon Lee.

Several major Saudi petrochemical producers, including SABIC, Tasnee, Yansab and Saudi Kayan have disclosed curtailed feedstock supplies in the wake of the attacks on the Abqaiq processing plant, which processes crude from the Ghawar, Shaybah and Khurais fields.

Saudi petrochemical plants tap natural gas, known as ethane, to make building block petrochemicals such as ethylene, from which many types of plastic are manufactured.

Spot prices of petrochemical including monoethylene glycol (MEG) and polyethylene (PE) have jumped in Asia.

Saudi Arabia accounts for about 10 percent of the global supply of polyethylene, which is used to make everything from plastic bags to milk cartons.

The Kingdom exported about 87 percent of its production to global markets in 2018.


Britain expects ‘very significant’ week for Brexit talks as clock ticks down

Updated 29 November 2020

Britain expects ‘very significant’ week for Brexit talks as clock ticks down

  • Despite missing several self-imposed deadlines, the negotiations have failed to bridge differences on competition policy and the distribution of fishing rights
  • Britain’s transitional EU exit agreement expires on Dec. 31, and Britain says it will not seek any extension

LONDON: Britain and the European Union are heading into a “very significant” week, British foreign minister Dominic Raab said on Sunday, as talks over a trade deal enter their final days with serious differences yet to be resolved.
EU negotiator Michel Barnier told reporters in London that “works continue, even on Sunday” on his way to a negotiating session, as both sides look for a deal to prevent disruption to almost $1 trillion of trade at the end of December.
“This is a very significant week, the last real major week, subject to any further postponement... we’re down to really two basic issues,” Raab told the BBC.
Despite missing several self-imposed deadlines, the negotiations have failed to bridge differences on competition policy and the distribution of fishing rights.
But Britain’s transitional EU exit agreement — during which the bloc’s rules continue to apply — expires on Dec. 31, and Britain says it will not seek any extension. A deal would have to be ratified by both sides, leaving little time for new delay.
“The bottom line is... in the ordinary course of things we need to get a deal done over the next week or maybe another couple of days beyond that,” Raab told Times Radio in a separate interview.
Earlier, he had signalled some progress on the ‘level playing field’ provisions which look to ensure fair competition between Britain and the EU, and said fishing remained the most difficult issue to solve.
Despite accounting for 0.1% of the British economy, fishing rights have become a totemic issue for both sides. Britain has so far rejected EU proposals and remains adamant that as an independent nation it must have full control of its waters.
“The EU have just got to recognize the point of principle here,” Raab told Times Radio.