Plastic News - By ARsons Corporation. Karachi, Pakistan

LONDON: Oil rose to around $102 a barrel on Friday, underpinned by Hurricane Ike which could threaten oil refineries in the United States, the world’s biggest energy consumer. US crude for October delivery was up 73 cents at $101.60 a barrel by 1629 GMT, trading from $100.65 to $102.89 per barrel.

London Brent was up 19 cents at $97.83 a barrel, after a fall to around a six-month low of $96.99 on Thursday. “We are on hurricane watch, as Ike takes aim at the US refining sector this weekend,” said Edward Meir of broker MF Global.

“We expect Friday’s session to end on a positive note. However, the markets could open sharply lower on Monday if Ike — similar to (Hurricane) Gustav before it — ends up being a ‘bust’.”

The US coastal areas under threat from Ike are lined with oil refineries that process about 25 per cent of the nation’s fuel. Ike is likely to come ashore late on Friday or early on Saturday as a Category 3 storm with winds of more than 111 mph (178 kph), according to the National Hurricane Center. Oil has seen a six year rally, driven partly by growth in demand from emerging market countries such as China and India.

The market reached a record peak of $147.27 a barrel on July 11 but has fallen about 30 per cent since then.

The prospect of lower demand for fuel from the United States and Europe, due to faltering economic growth, has contributed to the slide. A rebound in the US dollar has also put pressure on oil and some other US dollar-denominated commodities.

US crude oil prices came close to breaching the $100 mark on Thursday, despite the threat from Hurricane Ike. A report that Saudi Arabia had no plans to cut output, despite OPEC’s agreement in Vienna this week to trim supply, also undermined prices.

Saudi Arabia, the world’s largest oil producer, has no intention to reduce production at present unless customer demand falls, Saudi-owned daily Al Hayat reported on Thursday. -Reuters

NEW YORK: US crude oil stocks fell unexpectedly last week on a decline in imports and more demand from domestic refiners, while gasoline inventories decreased less than forecast, government data on Thursday showed.
The nation’s commercial crude oil supplies declined by 1.9 million barrels to 303.9 million barrels in the week to Aug. 29, the Energy Information Administration said in its weekly report.
The fall came as imports of crude oil dropped by 149,000 barrels per day last week, EIA added.
US crude oil runs were up 147,000 barrels per day at 15.26 million bpd last week. And refinery utilization rose 1.4 percentage points to 88.7 per cent of capacity against a forecast of no change.
Inventories of gasoline decreased by 1.0 million barrels to 194.4 million barrels last week, according to the EIA report, which was issued a day later than usual due to US Labor Day holiday on Monday.
That decline, the sixth weekly fall in a row, was smaller than analysts’ average forecast for a 1.4 million barrel drop.
Supplies of distillate fuels, which include heating oil and diesel, were off 400,000 barrels at 131.7 million barrels, countering analysts’ projections of a build of 500,000 barrels.
Weekly imports of refined petroleum products decreased by 334,000 bpd last week, the EIA added. -Reuters

LONDON: Oil fell by more than $2 on Thursday as concerns over weak demand outweighed an unexpected drop in US crude oil inventories.
US crude fell $2.08 to $107.25 a barrel by 1536 GMT, reversing an earlier gain of about $1. London Brent crude fell $2.33 to $105.73.
US government inventory data showed total demand for oil products, such as gasoline and distillates, over the past four weeks fell 3.5 per cent from a year ago.
Crude oil inventories fell 1.9 million barrels, compared with a forecast of a 200,000 barrel increase ahead of the release of the data. But inventories at Cushing, the delivery point for US crude, increased.
Inventories of gasoline decreased by 1.0 million barrels.
“Demand is still pretty weak,” said Simon Wardell of Global Insight. “We are seeing much more supply and I think demand is going to take precedence at the moment.”
Hurricane Gustav this week did not cause much physical damage to oil production facilities in the Gulf region, home to a quarter of US crude output, but 11 refineries on the coast remained shut.
Entergy Corp, Louisiana’s largest utility, said earlier this week that the worst damage was in the New Orleans-Baton Rouge area, home to some of the biggest US plants, including Exxon Mobil’s giant Baton Rouge facility.
Entergy said on Wednesday the full recovery of its power grid might be weeks away, while the company was restoring some power supply.
Hurricane Ike strengthened into an extremely dangerous Category 4 hurricane in the open Atlantic on Wednesday although it posed no immediate threat to land. Tropical Storm Hanna intensified to a lesser degree as it swirled over the Bahamas toward the southeast US Coast.
Traders are awaiting OPEC’s Sept. 9 meeting. Analyst PFC said a consensus was building within OPEC to cut output to support prices and prevent a supply overhang from developing.
Iran has said the producer group may need to cut oil supplies by as much as 1.5 million barrels per day (bpd), nearly 5 per cent, to balance global markets by early next year. -Reuters

Heavy price of crude oil along with the growth in sugarcane plantations in Brazil has triggered the  development of bioplastics from sugarcane. Brazil’s two largest ethanol players, Dow Chemical and Crystalsev have planned for a joint venture to build a 350,000 tpa polyethylene from sugarcane thus making brazil the first country to manufacture polyethylene from sugar cane by.

Titan Chemicals Corp. Bhd. posted RM 3.7 billion in revenue and RM 206.7 million in profit after tax (PAT) for the second quarter of this year as a result of the contribution of Butadiene, a new product, and increase in selling prices and sales volume of existing products, Managing Director Warren Wilder said.

He said Titan Chemicals’ revenue increased by 25% and Profit Before Tax rose 65%, as compared to the first three months of this year.

Based on the compilation of database from Platts and ICIS database, the quarterly average polymer price rose from US$1,550 per tonne in the first quarter to US$1,709 per tonne in the second quarter of this year. Average quarterly naphtha prices also climbed from US$873 per tonne in the first quarter to US$1,033 per tonne in the last quarter.

Wilder also said Titan Chemical increased Liquefied Petroleum Gas (LPG) utilization rate to 25 per cent by the end of the quarter, as a strategic move of substituting naphtha with LPG, a cheaper feedstock alternative.

“With Berge Frost, one of the world’s largest VLGCs (Very Large Gas Carriers) berthed at Pasir Gudang in June, we have a cost-effective and immediate storage facility in place. Titan Chemicals has an advantage in switching to the most economical feedstock blends as our crackers are designer to process both naphtha and LPG,” he said.

On its Indonesian operations, Wilder said PT Titan Kimia Nusantara Tbk (PT. Titan) has achieved a second consecutive quarter of record production for its polyethylene (PE) production volume.

“We are also pleased to announce that PT. Titan’s largest PE line has commenced operations during the quarter. Barring unforeseen circumstance, Titan Chemical plans to raise PE production in our second domestic market to a new level in 2008,” he said.

Looking ahead, Wilder said the growth of Indonesian as its second domestic market will support Titan Chemicals’ business expansion going forward.

“With the expansion of the group’s portfolio of products into Biaxially-Oriented Polypropylene (BOPP) products in Indonesian, team members from Malaysia and Indonesia have been working closely to bring the new business into the group,” he added.

In another development, Wilder also announced that as of June 2008, Titan Chemicals has complete a new tern loan of US$332.5 million to refinance an existing team loan.

“The terms and conditions of this new term loan is a better fir to the business environment of the company and the industry cycle. Titan Chemicals will continue with its strategy of growing the business while maintaining cost-efficiencies in all its operations,” he added.

Titan Chemicals Corp. Bhd.