Factbox: Petrochemical markets shrug off OPEC+ deal, await potential impacts in May

Petrochemical markets were largely unimpressed with the OPEC+ deal reached over the Easter holiday weekend, as global oil output cuts were not slated to start until May and demand destruction was seen as deeper than the cuts could address, sources said.

"Need to see US producers cut first to see what happens," a US olefins source said.

Under the deal announced Sunday, the 23-country OPEC+ alliance will reduce output by 9.7 million b/d of crude oil for May and June, down from 10 million b/d initially expected, as Mexico was allowed a more generous quota.

NYMEX May WTI closed on Monday down 35 cents at $22.41/b, and ICE June Brent was 26 cents higher at $31.74/b. NYMEX RBOB gasoline futures for May settled Monday at 70.33 cents/gal, up 2.60 cents/gal from Friday. Some aromatics markets saw a bump in pricing, but sources said production cuts and low margins were likely as or more responsible for pressured prices than crude prices, and it remained to be seen whether demand would rebound.

A downstream polymers source said the lower-than-expected deal was a "little disappointment," but once the cuts are implemented, "that is building some positive scenario that we may be seeing two to three months down the road."

European markets were closed Monday in observance of the Easter Monday holiday.

TRADE FLOWS

**US ethylene dichloride exports fell 36% to 108,881 mt in February from January, reflecting waning demand amid the coronavirus pandemic, the latest US International Trade Commission data show.

**US caustic soda exports rose 45% to 472,924 mt in February compared to January, reflecting increases to alumina producers in Australia and Jamaica, the latest USITC data show.

**Brazilian exports benzene was down 55.2% year on year at 10,579 mt, valued at $6.57 million FOB. A year earlier, the 23,588 mt imported were valued at $12.14 million FOB. All March exports were destined to the US.

**Brazilian exports of toluene in March were up 26.6% year on year at 7,136 mt. The exports were valued at $3.66 million FOB. A year earlier, the 5,637 mt exported were valued at $3.43 million FOB. The US imported 7,085 mt, followed by Uruguay with 26 mt and Paraguay with 25 mt.

OLEFINS

**Non-LST purity ethane was assessed at 11.25 cents/gal, up 1.125 cents/gal from Thursday.

**US spot ethylene was unchanged at 8 cents/lb for Mont Belvieu and Choctaw

**Non-LST propane was assessed at 34.25 cents/gal, up 2 cents/gal from Friday.

**Spot polymer-grade propylene was flat at 23.25 cents/lb.

POLYMERS

**Export LDPE prices dropped $11 on Monday at $904-$926/mt (41-42 cents/lb) FAS Houston

**Export HDPE blowmolding remained flat day on day at $618-$640/mt (28-29 cents/lb) FAS Houston

**Export LLDPE butene prices stayed static Monday at $595-$618/mt (27-28 cents/lb) FAS Houston

**Export homopolymer PP prices lowered $11 on Monday at $1036-$1058/mt FAS Houston

**Post-consumer FOB Los Angeles bottle bales for both premium and curbside grades were flat Monday at 18 cents/lb and 7.50 cents/lb.

AROMATICS

**May NYMEX RBOB futures settled at 70.33 cents/gal, up 2.6 cents/gal from Thursday

**US Gulf Coast light straight-run naphtha was assessed at 35.25 cents/gal, up 1.75 cents/gal from Thursday

**US nitration-grade toluene climbed 4 cents/gal to 97 cents/gal, moving with RBOB futures.

**Mixed xylenes were assessed 6 cents/gal higher at 104 cents/gal.

**April benzene was assessed 4 cents higher at 110 cents/gal DDP USG, and May benzene closed 3 cents higher at 115 cents/gal DDP USG.

**US styrene monomer was assessed flat Monday, with April at $455/mt FOB USG and May at $475/mt FOB USG.