Gulf petrochemical producers' target market shifts

Recently, the Secretary-General of the Gulf Petrochemical Association Abdulwahab Asadun stated that due to various reasons, such as the significant increase in the output of China’s petrochemical products in the main export market and the impact of the new crown pneumonia epidemic, the region’s petrochemical products will be exported to Asia.
Exports have been suppressed to a certain extent
.

Petrochemical companies in the Gulf region predict that companies in the six GCC countries (Saudi Arabia, UAE, Kuwait, Qatar, Oman, and Bahrain) will stabilize the output of petrochemical products at 175 million tons in 2021, and the past growth momentum will be temporarily suppressed

China's exports of petrochemicals are suppressed

　The export of　petrochemicals to China is suppressedThe export of petrochemicals to China is suppressed

Asadun said that for a long time, China has been the largest export market for petrochemical producers in the six Gulf countries, accounting for 23.
8% of total exports
.

However, recently, as China's domestic petrochemical product output continues to increase, the Gulf region's future exports of petrochemical products to China have been restrained

In addition, the current COVID-19 pandemic has caused investment in some petrochemical projects in the Gulf to be delayed or reduced in scale
.

Among them, the most noticeable change is Saudi Arabia's US$20 billion crude oil-to-chemicals project

The competitive advantage of raw materials is still obvious

The competitive advantage of raw materials is still obviousThecompetitive advantage of raw materials is still obvious

Asadun stated that the Gulf petrochemical producing countries have a competitive advantage over some other producing countries
.

This is because producers in the Gulf region still use fixed-price natural gas as feedstock, while Asian competitors rely on naphtha

Asadun pointed out that as the price of crude oil rises, the petrochemical industry in the Gulf region will become more prosperous
.

It is estimated that by the end of this year, the prices of petrochemical products may be close to the level before the new crown pneumonia epidemic

Targeted at Africa and the local market

　The goal is aimed at Africa and the local market　The　goal is aimed at Africa and the local market

Asadun said: "We see opportunities in the African market
.

In addition, the petrochemical industry in the Gulf Cooperation Council is now turning to high-value products, such as specialty chemicals

According to estimates by the Gulf Petrochemical and Chemical Association, between 2020 and 2024, Gulf petrochemical producers are expected to invest US$71 billion in new domestic development projects
.

This is happening when Asia is gradually becoming self-sufficient, trade protectionism is rising, and trade barriers are increasing

Asadun said: “In the Gulf region, there is a trend to develop special parks for the downstream value chain to obtain more value and create jobs in the country
.

Nevertheless, given the small scale of the domestic regional market, our petrochemical industry The industry is expected to remain export-oriented