Oil prices dived on Monday overpowering the gains made after major oil producers agreed for output cuts, pressured by concerns that the cuts will be too little to come out of the oversupply situation as the coronavirus pandemic incurs unprecedented slump in global crude demand.

1. PetrochemicalIndustryExperiencesaRollerCoasterRideasFurtherDownsideAwaits
Key Headlines
• ONGC Gas Output Drops to 15%, Lesser Demand Hits the Market
• Indian Oil to Fill its Underground Reserves with First Oil Shipload Arriving from UAE
• Oil Rebounds “But Little” After the Producers Sign Compromise Deal
• Asia’s Methanol Industry Suffers Supply Glut as Exporters Target China
• ExxonMobil Postpones Two Cyprus Energy Drills
Asia Pacific Chemicals Pricing (Key Products)
• Ethylene- Sluggish demand for downstream ethylene derivatives has continued to push down the prices of the
product. Ethylene prices dropped to $350/tonne CFR South East Asia.
• Benzene- Benzene prices witnessed an uptrend post recovery in line with rising value of upstream crude oil and
stable downstream demand. CFR India prices of the product settled at $380/tonne, up by around $ 15/tonne
than on Friday.
• Butadiene- Butadiene tumbled in Southeast Asia due to bearish buying sentiments backed by high inventories.
CFR Prices of Butadiene in Southeast Asia settled at $355/tonne, down by $85/tonne from previous revision.
• PET- Prices of PET remained in doldrums on reduced consumption from industries at the back of production cut
and turnarounds amid Coronavirus stress. PET plunged to $700/tonne CFR Southeast Asia with a fall of
$10/tonne.
Crude Oil Scenario
Oil prices dived on Monday overpowering the gains made
after major oil producers agreed for output cuts, pressured
by concerns that the cuts will be too little to come out of the
oversupply situation as the coronavirus pandemic incurs
unprecedented slump in global crude demand. This deal was
signed after four days of intense negotiations as the OPEC+
group of oil producers, comprising the OPEC countries,
Russia and other countries, agreed to curtail their outputs by
9.7 million(bpd) in May and June. Brent crude futures slipped
by 1.7%, at $30.96 a barrel by 08:10 GMT after opening at
$33.99, however, US West Texas Intermediate (WTI) crude
futures fell by 0.5%, to $22.64 but remained oscillating
between positive and negative values throughout the day.
Edition: 14th April 2020 #TheChemAnalystExpress
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WTI Crude

2. Exclusive News & Analysis
Covid Tough on Asia’s Methanol Industry
Since the outbreak of novel coronavirus in China, which in short time began to grip several economies, Asia’s trade
flows have incurred dramatic changes in its petrochemical sector. Prices of several petrochemicals have fallen to record
breaking lows in the month of March and April with almost negligible margins. Looking at the current scenario, when
bigger economies (like U.S. and Europe) are on the verge to slip into recession, it is anticipated that Asia is likely to
become dumping ground for many chemicals. In addition, panic in the crude market is further stimulating huge volatility
in Asia’s chemical sector. Traders are cautious as extended lockdown measures drag the petrochemical price
downwards showing no signs of recovery, but huge volumes of methanol are expected to be traded in this month amid
scarce tank storage space. As per several sources, China is about to welcome about 1.1 million mt of methanol imports
in April.
• India
Methanol prices lowered in India as the players sense
extension of the lockdown period due to rise in
number of positive coronavirus cases in the country.
There are indications that the duration of lockdown
will be extended beyond April 14, the day when it was
supposed to end as stated by the prime minister
Narendra Modi in his speech on 24th
March. Post the
announcement, several methanol manufacturing
units in India had announced plant closures backed by
bearish market sentiments and supply glut. Methanol
CFR JNPT prices dropped to $264 per MT in the second
week of April following the international trend.
• China
China’s methanol-to-olefins (MTO) production
slumped between February to March due to
unprecedented demand slowdown and supply chain
disruptions. However, as the country headed towards
recovery by the end of March, traders and suppliers
started targeting cargoes towards China due to
subdued demand in U.S. and Europe. This poses a
challenge among local manufacturers who are selling
cargoes at reduced rates. Methanol prices CFR East
China were assessed to be $248 on Friday. As per the
analysts, Methanol prices will rebound in this week on
the back of improved demand from Propylene and PP
for making masks and other medical applications.
Analyst View on OPEC+ Deal
Analysts believe that the deal signed to introduce production cuts is not enough to nullify the damage caused
collectively by the price war and Covid-19. The apprehensions can be easily sensed from the crude prices on Monday
which swung between gains and losses as players believe that nothing could offset the 19 million barrels per day
average April-May demand loss due to the pandemic. It is henceforth being predicted that crude prices will decline
further in the coming weeks as storage capacity becomes saturated and demand remains muted.
0
200
400
600
800
USD/MT
Methanol Weekly Price Variation (India)
CFR JNPT Ex-Works Dibrugarh
0
50
100
150
200
250
300
USD/MT
Methanol Weekly Price Variation (China)
CFR China

3. Industry Research
International Plant Shutdown News
• Exxon Mobil Halts Drilling Operations in Cyprus Energy
Exxon Mobil, the U.S. based multinational oil and gas company, has announced suspension of its two Cypriot gas drills
scheduled for July 2020 till September 2021. The decision was taken in consideration to the pandemic stress and acute
volatility in the international petrochemicals market due to plummeting prices of oil. The company has blamed the
logistical disruptions and rising cases in U.S. for its operational cuts. The company has also cancelled drilling activities
in other parts of the world. This happened just few days after the CEO of the company announced to implement about
30% cut in its capital expenditure taking into consideration the impact of the pandemic to the energy market.
• Ukraine suspends Plant Operating to Develop New Missile System
Ukraine has announced temporary shutdown of its Pevlograd Chemical Plants engaged in manufacturing explosives and
charging ammunitions. According to State Defence Order, lack of funding from government to finance operations and
services has made corporation to shut operations till they are economically secured. With this plant shutdown, the
complete missile project has come to a dead end with no ray of hopes to be seen for recovery.
India Plant Shutdown News
• GAIL Shuts Pata Plant Due to Demand Destruction
GAIL(India) Ltd. has shut its petrochemical unit located in Pata, Uttar Pradesh joining the list of Petchem makers who
have halted their production activities due to unprecedented slump in demand and supply chain disruption due to
covid-19.The concerned authorities decided to first cut the capacity of the 400KTPA Polyethylene plant at the Pata
complex by half. The company has also shut its PP plant and 210 KTPA HDPE/LDPE plant located in Pata.
• IOC To Extend the Shutdown at Paradip Refinery
Indian Oil Corporation, a state-owned oil and gas company has reported to maintain shutdown in its Paradip Refinery
at the back of lockdown extension in Odisha amid rising concerns over Covid-19. Company’s Paradip plant is engaged
in the production of Propylene and Ethylene with a capacity of 900 KTPA and 200 KTPA respectively.
• IG Petrochemicals Announced Liquidation of IGPL Subsidiary
IG Petrochemicals, a renowned company engaged in the business of phthalic anhydride, maleic anhydride and benzoic
acid has announced liquidation at its IGPL subsidiary located in Taloja, from 12 April. This happened as the subsidiary is
no longer undertaking any operations.
Plant Resumptions
• Taiwan’s CPC To Resume Operations at Linyuan Cracker from Next Week
CPC refinery of Taiwan, a renowned name in the oil and gas sector, has planned to restart operations at its larger
ethylene cracker unit having capacity of around 700 KTPA, from the next week. The refinery is in Linyuan and was on a
halt since 13th
February for scheduled maintenance. However, CPC's second and smaller 385 KTPA ethylene cracker in
Linyuan continues to operate at full rates.
• Khaitan Chemicals and Fertilizers Resumes Production in Plants
Khaitan Chemicals, a company engaged in the manufacturing of straight inorganic fertilizers has reported to restart
operations in its plants by undertaking approval from the government. The company has its plant facilities in Dahej
(Gujarat), Somni, Jhansi & Malwan (U.P), Nimrani (M.P), Nimbahera (Rajasthan) and Rajnandgaon (C.G). Operations in
these plants were suspended in response to the preventive measures put up by the government to constrain the
spread of choronavirus.

4. Strategic Expansions
• Yongtai Technology Planning to Invest in a New Project towards Industrialization of Fine Chemicals
Zhejiang Yongtai Technology, a company engaged in manufacturing of aromatic fluorides has reported to invest in a
Fine Chemical Industrialization Project in Inner Mongolia, China. Phase 1 of this industrialization project is anticipated
to be completed within 2 years. The projects aim to contribute to a capacity of about 30000 tonnes of potassium
fluoride and 18715 tonnes of fine chemicals along with co-production of several other chemicals like calcium chloride,
calcium sulfate, sodium sulfate, hydrochloric acid, silicon dioxide and hydrobromic acid.
Latest Technological Investments
• DGIST Recently Announced the Success of New Photovoltaic Commercialization Technology
DGIST, a Korea based university of science and research has recently announced the development of a technology
based on Colloidal Quantum Dot Photovoltaic (PV) Devices which is anticipated to accelerate the production of next
generation photovoltaic devices. This new technology aims at improving the stability along with improvising the
performance of the PV devices.
• Zymergen Aims for Fabrication of High-Performance Bioelectronics
World Economic Forum Tech Pioneer, Zymergen introduced Hyaline, a new biofilm for electronic applications.
Until recently, most electronic devices were manufactured on hard computer chips covered in transistors and other
semiconducting elements. Those chips are inflexible, however making our smartphones, laptops, watches, and
televisions rigid. Bio-based electronic films would support the manufacturing of appliances that are smaller, lighter,
and more battery efficient at a lesser expenditure. Hyaline may be the first fermented electronic products and being
widely used in flexible circuits, display touch sensors, and printable electronics.
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