Cost Curve Scenarios from IHS Markit
What would happen to the world cost curves for Ethylene and Polyethylene-HDPE if oil prices don’t rise to the IHS Markit forecast?
World Cost Curve: Ethylene
- The Middle East average cost advantage vs. North America increases from $67 to $106, largely a consequence of cracker feed mix region to region, as directionally the United States is getting lighter as Middle East is getting heavier.
- At the same time, Northeast Asia becomes much more competitive in comparison to both North America and the Middle East.
- This should translate to more competitive Chinese and other North East Asian ethylene derivatives.
- This can be clearly seen for HDPE for integrated economics for those producers with ethylene production.
World Cost Curve: Polyethylene - HDPE
- The average NAM cost advantage for HDPE delivered to China compared to domestically produced Chinese HDPE is reduced by $162 per ton for the lower oil price scenario.
- The Middle East cost delivered cost advantage is reduced by about the same magnitude.
- IHS Markit Competitive Cost & Margin Analytics can help you assess the cost and margin positions of operating chemical plants according to geography, capacity, time, technology, feedstock, operating rate and integration level.
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