According to reports, due to unexpected production problems, steam crackers in the UK and other European countries (including Germany and Sweden) have been reducing production in recent weeks.
It is reported that this has tightened the supply of pyrolysis gasoline raw materials needed to extract benzene. The decline in demand after the new crown epidemic has led to a decline in profit margins, and oil refineries have cut operating rates for a long time. This also reduces the supply of reforming raw materials and further puts pressure on the supply of benzene.
Relevant sources said that despite the gradual tightening of supply, the demand for downstream industries such as styrene and cumene is still strong.
"We saw a significant increase in sales of cumene," a market source said. "It was difficult to purchase benzene in December, not only because of the price, but also because of the poor supply."
At the same time, Simon Cleghorn, consultant/aromatics director for IHS Markit Europe, Middle East and Africa, stated that the low inventory capacity in Europe has limited effect on alleviating short-term imbalances between supply and demand. "The benzene storage capacity of the ARA benzene trading center is relatively low, which may cause market volatility, especially when faced with unexpected supply problems." Cleghorn said.
At the end of January 2021, at least 35,000 tons of benzene will be shipped from the United States to Europe to increase the supply of benzene in Europe.
Source: Chemical Network
