France Petrochemicals Q4 2019
External markets are having a significant downside effect on French petrochemicals production, although domesticconsumption levels are being supported by stable local demand. As such, Brexit is set to be the major risk facing the sector in Q419.A more drastic fallout in UK demand following the UK's exit from the European Union coupled with US President Donald Trump'strade protectionist tendencies will combine to create headwinds for French exporters, hurting the petrochemicals industry. AsFrench petrochemicals crackers depend on naphtha for 80% of feedstock, competitiveness will be affected by crude prices, whichare also facing uncertainty and volatility. However, French car manufacturers, which are a major consumer of petrochemicalsincluding high value-added products, are placed to perform better than the sluggish construction sector. Altogether, Q419 isshaping up to be a period of high risk and uncertainty for a petrochemicals sector that was already facing issues of competitivenessand the downturn in the economic cycle.
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