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Russia Petrochemicals Q4 2018

Russia Petrochemicals Q4 2018

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With oil prices set to rise above USD70/bbl in 2018 and 2019 as a result of sanctions on Iran, Russian oil prices are set torise and should stimulate the local petrochemicals market. However, this trend will also raise naphtha feedstock costs, which areindexed to oil prices, and this could undermine the competitiveness of Russian petrochemicals production. Where the market is insurplus, we can expect to see margins put under pressure as local producers compete with imports from countries with feedstockcost advantages, particularly the Middle East, and seek to export. However, for much of 2018, the Russian polymer market was tightand although this drove up prices - and in turn margins - the competitiveness of local petrochemicals production ensured that risingimports did not undermine local operating rates. In the likely event that in the 2020s, oil prices return to the USD90-100/bbl levelseen before 2014, producers have the option to utilise more feedstock from the country's immense ethane resources and diversifyfeedstock. Feedstock flexibility, as well as product diversification, will be key to growth in Russian petrochemicals capacity.


Key View
SWOT
Petrochemicals SWOT
Industry Forecast
Economic Analysis
Macroeconomic Forecasts
Industry Risk/Reward Index
Europe Petrochemicals Risk/Reward Index
Russia Petrochemicals Risk/Reward Index
Market Overview
Industry Trends And Developments
Company Profile
Sibur Holding
Lukoil
Nizhnekamskneftekhim (NKNKh)
Regional Overview
Europe Overview
Global Industry Overview
Russia Demographic Outlook
Petrochemicals Glossary
Petrochemicals Methodology

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