Israel Petrochemicals Report Q4 2017
BMI View: Our outlook for the petrochemicals sector has been revised downwards in view of slower economic growth as well as a contraction in output. A strong shekel and sector-specific challenges will continue to weigh on growth and any rise in oil prices would put Israeli petrochemicals margins under further pressure.
The Israeli petrochemicals industry witnessed a narrowing of margins, indicating that it is feeling the pressure of rising oil prices. Yet, opportunities for diversifying the feedstock mix are limited, suggesting that basic chemicals will receive little investment in capacity expansion over the next five years.
In 4M17, rubber and plastic production declined 2.3% y-o-y, reversing some of the gains seen in 2016 when production rose 7.4%. Meanwhile, petroleum and chemical products fell 1.0%, on top of the full-year fall of 0.3% in 2016. The declines are in line with a slowdown in economic growth with real GDP growth at 4.0% y-o-y in Q117, down from 5.7% y-o-y in Q316 and 4.3% y-o-y in Q416.
Learn how to effectively navigate the market research process to help guide your organization on the journey to success.Download eBook