Global production of polymers and synthetic fibers will require a projected 18.4 million barrels per day of oil by 2030, or "more than one in every six barrels,” according to the International Energy Agency's Oil 2025 report. Nonetheless, the five supermajors are bearish on the short-term global petrochemicals market. Exxon Mobil CEO Darren Woods recently noted “very challenging margins” driven by overcapacity in Asia and the Middle East, while Shell CEO Wael Sawan said the sector is in an “incredibly prolonged trough … that could potentially run for a lot longer.” Below, we look at how the supermajors are positioned in chemicals and what levers they are pulling to weather the challenging conditions.
Further along the portfolio rationalization route than its peers, Exxon is arguably the best placed of the majors in the chemicals business. The US major has steadily been high-grading its downstream portfolio in a bid to withstand “tough conditions” in the chemicals market. Exxon sold its 140,000 b/d Fos-sur-Mer refinery in southern France last year and now plans to sell its 230,000 b/d Gravenchon refinery in northern France by the end of this year, having closed the site’s chemical production units last year.
