The Barrel: the essential perspective on global commodities

Emma Slawinski
Editor, Platts Insight

Global energy transition, IP Week preview, IMO 2020: The week in energy and commodities

February 22, 2019 11:46 UTC

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The global energy transition is well underway, but it was a week of mixed signals in the drive for decarbonization. In Europe, additions of wind power capacity in 2018 fell to their lowest level since 2011 and the outlook for investment is uncertain, sector association WindEurope said.

Meanwhile, the EU struck an informal deal to enforce lower emissions from heavy goods vehicles. The rules would see new HGVs emit an average of 15% less CO2 by 2025 and 30% less by 2030 compared with 2019.

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automobiles, coal, energy transition, gas, IP Week, metals, oil, shipping, tariffs, wind

Luke Milner and Ben Brooks
Associate editors, petrochemicals

Is European recycling up to the plastic waste challenge?

February 21, 2019 09:28 UTC

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This is the concluding article in a three-part series exploring oil, plastics demand and sustainability.

European governments and corporates are setting ambitious goals on plastics recycling, but there are practical and economic hurdles to get over if the policies are to be a success.

Not only do some countries’ domestic markets lag behind, but there is a general reliance on material from countries such as Germany and the Netherlands where more inroads have been made to cope with high levels of demand.

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Europe, PET, petrochemicals, plastics, recycling, sustainability

Paul Hickin
Associate editorial director

The Middle East’s petrochemicals push signals oil’s future

February 20, 2019 08:25 UTC

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This is the second installment in a three-part series exploring oil, plastics demand and sustainability.

Plastics and chemicals will account for the largest share of global crude demand growth by 2030, and a third wave of petrochemicals expansion underway in the Middle East is looking to cash in on the trend, as investment into downstream petroleum industries will become a critical demand driver for oil markets in the future.

Industrialized economies use up to 20 times more plastic and up to 10 times more fertilizer than developing nations on a per person basis, underscoring the huge potential for global growth. The International Energy Agency expects petrochemicals to account for almost half of global oil demand growth by 2050, equivalent to almost 7 million b/d.

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Middle East, oil, Oman, petchems, plastics, Saudi Arabia, UAE

Philip Reeder
Associate editor, light ends

Consumer push for sustainability masks massive growth in plastic demand

February 19, 2019 06:30 UTC

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This is the first installment in a three-part series exploring oil, plastics demand and sustainability.

Barely a week goes by without another headline decrying the use of plastics and plastic packaging in Europe. Plastics are clogging up our oceans, overflowing our landfill sites and even finding their way into our food.

But as the world wakes up to the environmental damage caused by plastic waste and pollution, it may come as a surprise to learn that the industry is looking to dramatically ramp up production, not slow it down.

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environment, oil, petrochemicals, plastics, recycling, sustainability

Andrew Critchlow
Head of news, EMEA

Russia’s OPEC alliance brings risks and rewards for Putin

February 18, 2019 09:37 UTC

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OPEC still needs Russia to prop up oil markets, but the arguments for an even closer relationship with the cartel are weakening.

The Kremlin’s two-year-long alliance with the 14-member group has been useful up to a point. On the one hand, oil diplomacy has helped to bolster President Vladimir Putin’s growing regional ambitions in the wider Middle East. On the other, Russia’s economy has also benefited from higher prices buffing up Putin’s financial credentials and popularity at home.

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oil, OPEC, Qatar, Russia, Saudi Arabia, US, Vladimir Putin

Emma Slawinski
Editor, Platts Insight

China oil imports, Nigeria elections and Venezuela sanctions: Commodity and energy news highlights

February 15, 2019 11:34 UTC

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The Lunar New Year brings shifts in supply and demand patterns across commodities, and 2019 was no different. Chinese oil imports saw a strong year on year increase in January, but February figures are likely to be weaker due to the vacation. Meanwhile, steel markets were braced for pent up demand as China went back to work.

Ferrous markets continued to focus on the fallout from Vale’s catastrophic iron ore dam failure, with far-reaching Brazilian legislation now responding to the disaster. Neighboring Venezuala is still in the grip of political turmoil, meanwhile, with consequences for global oil trade flows and supply chains further downstream.

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Brazil, bunkers, China, iron ore, LNG, Nigeria, oil, renewables, Venezuela

Rosemary Griffin
Editor

Brexit could lead to divergence between EU, UK sanctions against Russia

February 14, 2019 10:04 UTC

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In the event of Brexit there could be long-term consequences for UK-Russia energy links, if the UK’s policy on sanctions against Russia changes to reflect its vocal opposition to the current Russian government, and close relationship with the US.

“There is a good chance the UK would eventually toughen sanctions against Russia, if and when a deal to leave the EU is finalized,” Paul Sheldon at Platts Analytics said. Currently the UK is a participant in EU sanctions against Russia introduced gradually since 2014 in response to Russia’s role in the conflict in Ukraine. These include restrictions on Russian oil and gas companies’ access to long-term financing and technology used in offshore Arctic, shale and deep-water oil production.

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Brexit, EU, gas, oil, Russia, sanctions, UK

Mayumi Watanabe
Senior Editor, Metals

Insight: Aluminum costs push Japan’s brewers to put new beer in new bottles

February 13, 2019 12:18 UTC

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From relatively traditional roots, the Japanese beer industry became a hotbed of innovation in 2018 — giving rise to new and esoteric brews, and causing brewers to think again about the use of costly aluminum as a packaging material.

For over 100 years, legislation dictated that beer had to contain 67% malt, with the balance of 33% strictly water, hops, yeast, corn, rice, or more malt. But a revision of the country’s alcohol laws – or “Shuzei ho” – which went into effect April 2018, allowed breweries to introduce a new gamut of flavors, including potato, fruit and spices. The revised legislation has also allowed the malt content in beer to be lowered to 50% from the earlier 67%.

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aluminum, brewing, cans, consumer goods, Japan, PET, plastics

Laura Huchzermeyer
Associate editor

In the LOOP: Narrowing Dubai/LOOP spread dampens US sour crude exports

February 12, 2019 16:19 UTC

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Narrower price spreads between US crudes and Dubai-based crudes have limited arbitrage opportunities to export US crude to Asia recently, S&P Global Platts data shows. However, some deals continue to get done as US crude delivered to Asia remains at a slight discount to competing grades.

In the first 29 trading days of 2019, the spread between LOOP Sour and Dubai has averaged about $2.60/b. That is compared with an average spread of $2.75/b during the same period a year ago.

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dubai, LOOP, oil, shipping, US

Andrew Critchlow
Head of news, EMEA

King coal retreats in Europe, but still powers global growth

February 12, 2019 09:44 UTC

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Coal is having a bad time in Europe. Germany – the world’s fourth largest economy – has said it will phase out coal-fired power generation by 2038 while in the UK, the closure of another large coal plant was announced.

Despite these setbacks, the fuel of the industrial revolution still has a vital role to play powering global growth in the future.

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Asia, China, coal, Europe, renewables, steel

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