US benzene prices gain as production curtailed on storm-related shutdowns

Houston — US spot benzene prices moved notably higher Feb. 16, as a number of refineries were offline following sub-freezing temperatures along the US Gulf Coast and downstream styrene pricing remained strong.

Prompt spot benzene prices on a DDP basis rose 8 cents from Friday, assessed Feb 16 at 264 cents/gal. There were no benzene assessments Feb 15 due to a holiday in the US. Spot activity ticked up with March heard traded twice Tuesday, once at 261 and again 262 cents/gal DDP LMR, sources said.

Spot benzene prices began to move higher on Feb. 12 with support coming from the downstream styrene segment. A production issue in Europe pushed styrene prices in the region to as high as $1,410/mt and subsequently lifted US pricing.

US benzene prices saw further support as sub-freezing temperatures took a number of refiners in the US offline. Exxon was reportedly down at its Baytown facility, S&P Global Platts reported. The company has an estimated benzene capacity of 730,000 mt/year at the site. Total shut its Port Arthur facility following a loss of steam, TCEQ reported. The reformer at Port Arthur has an estimated benzene capacity of 104,000/mt year. TCEQ filings also showed that Citgo had shut its plants at Corpus Christi, where the company has a benzene capacity of 167,000 mt/year. Shell had shut its Deer Park refinery where it has benzene production capacity of 217,000 mt/year, Platts previously reported. Additionally, Flint Hills (FHR) was reportedly down at its Corpus Christi site, according to a TCEQ filing. The company has a benzene capacity of 343,000 mt/year at Corpus Christi.

In total, an estimated 1.561 million mt/year of benzene has been impacted by storm-related outages meaning the US Gulf Coast could lose as much as 4,277 mt of benzene per day. On top of storm related outages, Marathon was poised to go into maintenance at its Texas City refinery, which has a reformer capable of producing 400,000 mt/year of benzene. The maintenance is poised to last approximately 6 weeks and could take an additional 46,000 mt of benzene out of the market.

The reduced benzene output comes at a time when downstream styrene producers have faced issues. Styrolution was heard to have shut down at Texas City and Bayport, a source said. The facilities have respective production capacities of 500,000 and 771,000 mt/year. Additionally, LBI was heard to have faced production issues and may have declared force majeure, sources said, though this could not be confirmed at time of publication. Prompt styrene prices were assessed Feb. 16 at $1,200/mt FOB USG.