Aromatics

Benzene prices on an FOB Korea basis and paraxylene (PX) prices on a CFR Northeast Asia basis increased sharply at the beginning of the week. As Iran declared closure of the Strait of Hormuz, prices for feedstock crude oil increased. Due to the shortage of crude oil, operation rates of refineries might fall and supply of aromatic products might be in shortage. As a result, the market was boosted.

Olefins

Ethylene prices on a CFR Northeast Asia rose sharply in the second half of the week. Due to the closure of the Strait of Hormuz, vessels loading crude oil and naphtha could not pass through the strait. As a result, operation rates of many naphtha crackers in Asia fell sharply. Since petrochemical makers in Northeast Asia and Southeast Aisa declared force majeure, supply of ethylene was seen to be in shortage. A Chinese maker that could use ethane from the US as feedstock sold ethylene for export at $1,250/mt and $1,350/mt on an FOB basis.

In Thailand, ROC shut down its naphtha cracker due to the shortage of feedstock.

In the Asia propylene market, supply was perceived to be tight.

The situation in the Middle East worsened and the Strait of Hormuz was closed. Under this situation, Asian petrochemical makers declared force majeure one after another. Supply was perceived to be tight and sellers were unwilling to sell. On the other hand, as China domestic prices fell in the second half of the week, buying interest weakened. But since supply was still tight, market sentiments were still strong.

Butadiene prices in Asia rose sharply. Due to supply concerns along with the tense situation in the Middle East, operation rates of facilities including naphtha crackers were falling and supply for butadiene was seen to be in shortage. Available cargoes were limited while buying interest was observed. As a result, the market was pushed up. In trade on a CFR Northeast Asia basis, information about several deals in the $2,000's/mt was reported.

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