Last updateTue, 24 Nov 2015 6pm


Global Petrochemical Prices Leveled Off in October

Prices in the $3-trillion-plus global petrochemicals market in October were virtually flat based on a monthly average, but edged slightly when valued on a month-end to month-end basis from September. This is the first time the markets have shown intermonth gains since May of this year, according to the just-released monthly Platts Global Petrochemical Index (PGPI). Petrochemical prices, expressed as a monthly average were $785 per metric ton (/mt) in October, down just $1/mt from September.Crude oil prices were up 2% in October, while naphtha prices climbed 3%. 

U.S. Rig Count Less Than Half of Last Years Total

According to Baker Hughes, the U.S. rig count declined by 10 last week to 757. Of these 757 active rigs, 564 rigs are seeking oil and 193 are seeking natural gas.

Just a year ago, with oil prices nearly double what they now, there were 1,929 active rigs in the U.S.

The rig count was at its peak in 1981 at 4,530 and at a low of 488 back in 1981. 

Gasoline-to-Crude Oil Differential at 11-Year High

"Regular gasoline in the U.S. has averaged $1.13/gal more than Brent crude, the global benchmark, so far in 2015, according to data compiled by Bloomberg based on AAA prices and Brent futures." That’s almost 20 cents/gal higher than the average in the past 10 years.

"Brent crude has slumped 23% this year after falling 48% in 2014 on concern a global glut will persist as the Organization of Petroleum Exporting Countries pumps above its collective target and U.S. production stays near a three-decade high. Retail gasoline has declined less than 5% in 2015. The price difference has helped boost earnings of refineries including Tesoro and Valero Energy." 

Companies Building Colorado-Oklahoma Oil Pipeline

Saddlehorn Pipeline Company, LLC is combining projects with Grand Mesa Pipeline, LLC for the construction of a 20-inch undivided joint interest pipeline which begins approximately 20 miles north of Platteville, CO. The joint interest pipeline will deliver various grades of crude oil from the DJ Basin to storage facilities in Cushing, OK. The initial capacity of the joint interest pipeline is expected to be 340,000 bpd, with Saddlehorn owning 190,000 bpd of capacity and Grand Mesa owning 150,000 bpd. 

LNG Projects Forecast to Drop After 2015 Peak

The LNG construction industry has enjoyed a sustained boom thanks to healthy order books of new LNG projects, especially in the U.S. and Australia, which will see it reach peak capacity in 2015. However as the global LNG market faces another supply glut, and with few pre-FID LNG projects on the horizon likely to materialise, a new analysis by Wood Mackenzie warns that the LNG Engineering, Procurement and Construction (EPC) sector which has generated over $200 billion of revenue in the last decade, will be facing its steepest decline in decades, leading to heightened competition and downsizing.

Mr Saul Kavonic a research analyst for Wood Mackenzie explains: “2015, will be recalled by the LNG EPC sector as the year in which their workload peaked. Worldwide, there are presently 31 trains concurrently under construction, 138 MMt/annum of nominal LNG production capacity, but this looks set to rapidly reduce.” 



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