Last updateThu, 23 May 2019 6pm


Global Chemicals Output Starts 2019 On Slow Note

Data collected and tabulated by the American Chemistry Council show that global chemicals production rose 0.1% in January. This follows a 0.3% gain in December, stable activity in November and a 0.1% gain in October. During January, production gained in North America, the former Soviet Union, Africa and the Middle East, and Asia-Pacific, was flat in Latin America and fell in Europe. With softness earlier last year, the Global Chemical Producing Regional Index was up only 0.5% year-over-year on a three-month moving average basis and stood at 116.2% of its average 2012 levels. 

U.S. to Lead Oil Supply Growth, No Peak Demand in Sight

The U.S. will drive global oil supply growth over the next five years thanks to the remarkable strength of its shale industry, triggering a rapid transformation of world oil markets according to the International Energy Agency’s annual oil market forecast. By the end of the forecast, oil exports from the U.S. will overtake Russia and close in on Saudi Arabia, bringing greater diversity of supply.

Global oil markets are going through a period of extraordinary change, with long-lasting implications on energy security and market balances throughout our forecast period to 2024. The U.S. is increasingly leading the expansion in global oil supplies, with significant growth also seen among other non-OPEC producers, including Brazil, Norway and new producer Guyana. 

New Methanol Plants to Increase Natural Gas Use

New methanol plants under development in the U.S. are increasing natural gas consumption in the industrial sector. Methanol plants are among the most natural gas-intensive industrial end users and require natural gas both as a feedstock and for process heat. Three new plants expected to come online in 2019 and 2020 have a combined nameplate capacity of about 3.3 million metric tons per year (MMmt/y) and would increase total U.S. methanol capacity to 9.4 MMmt/y, or 25,600 metric tons per day (mt/d)—a 45% increase from the current U.S. capacity. 

Chemical Activity Barometer Flat in February

The Chemical Activity Barometer (CAB) posted no change in February on a three-month moving average (3MMA) basis. On a year-over-year (Y/Y) basis, the barometer is up 0.2% (3MMA). The unadjusted measure of the CAB rose 0.2% in February and 0.1% in January after a 0.2% decline in December.

“The Chemical Activity Barometer reading was essentially flat in February following three months of decline,” said Kevin Swift, chief economist at ACC. “The cumulative drop was 1.0% – still well below the 3.0% threshold for a recession signal. The latest CAB signals gains in U.S. commercial and industrial activity through mid-2019, but at a slower rate of growth as compared with a year earlier.” 

FERC Approves 234-Mile Midship Pipeline

The Federal Energy Regulatory Commission (FERC) “has given Cheniere Energy approval to begin construction on its $1 billion, 234-mile Midship Pipeline in Oklahoma,” Kallanish Energy reports.

“The pipeline is designed to transport 1.44 billion cubic feet per day (Bcf/d) of natural gas from Oklahoma’s SCOOP and STACK plays to the Gulf Coast via existing lines for export as liquefied natural gas.” 

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