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Oil Markets

Key oil price movements across the globe analyzed.

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Jul 03, 2025

A dive into distillates: The latest on Europe's diesel and jet fuel markets

Refined Products, Crude Oil, Diesel-Gasoil, Jet Fuel, Fuel Oil July 03, 2025 A dive into distillates: The latest on Europe’s diesel and jet fuel markets Featuring Gary Clark, Virginie Malicier, and Nadia Bliznikova With European middle distillate markets remaining well supplied amid turbulence in the Middle East, the prospect of new legislation regarding the origin of European product imports provides fuel for thought for market participants. To discuss the latest developments in the middle distillate markets, Gary Clark is joined by Virginie Malicier and Nadia Bliznikova with a sharp focus on diesel and jet fuel dynamics in the EMEA region. Links: European oil product markets soar as Israel-Iran tensions intensify (Subscriber content) ARA diesel, gasoil stocks plunge 10% on week: Insights Global (Subscriber content) Jet CIF NWE Cargo PJAAU00 ULSD 10ppmS FOB ARA Barge AAJUS00 ULSD 10ppmS CIF NWE Cargo AAVBG00 ULSD 10ppmS CIF Med Cargo AAWYZ00 View Full Transcript Gary Clark: Hello and welcome to the Platts Oil Markets Podcast by S&P Global Commodity Insights, where today we'll be talking about the European diesel and jet fuel markets, which have diverging demand trajectories but remain well supplied despite geopolitical tensions in the Middle East and the potential for new legislation in the EU, which could disrupt the origin of oil product imports into Europe. I'm Gary Clark, and I manage the EMEA Clean Refined Products price reporting team based out of London. I'm joined by Nadia Bliznikova, who is a senior price reporter looking at European diesel markets, and Virginie Malicier, who manages the EMEA Middle Distillates team. Welcome all. Jet fuel and diesel prices are often highly correlated given they're fractions and neighbors in the distillation column. But we know diesel and jet fuel obviously have different supply and demand characteristics, and this results in their prices diverging at times. And we know that both jet fuel and diesel have got very divergent demand trajectories. We know that obviously flight traffic is increasing, whereas diesel demand in Europe is falling. But the interesting thing about both markets is they've been characterized as supply-driven markets. Jet fuel traditionally because it receives waves of imports from east of Suez markets. And lately, or more lately, shall we say, diesel since the start of the Russia-Ukraine war, Europe gets a lot more of its diesel from east of Suez markets, like the Arab Gulf and also the west coast of India. So, supply-driven markets, and they're markets in which for both of them supply is very much in focus. Obviously we've had the Israel-Iran conflict. There's still tension surrounding that, and I'm sure we'll talk about risk premium for both jet fuel and diesel. But also notably a new legislation from the European Commission. Or potential, sorry, legislation on potentially banning oil imports into the EU, which have been made from Russian crudes, for instance. So both things which affect potentially supply in these markets. So, moving over to you, Nadia. Maybe you could give us a bit of insight on what you are seeing for supply and demand in the European diesel markets right now. Nadia Bliznikova: Yeah, you're absolutely right. The Israel-Iran conflict sent European diesel markets into a tailspin as the rising tensions heightened the risk of supply disruptions from key producers and the potential spillover effects into other neighboring nations, oil-producing neighboring nations. As Middle East has become a key source of supply for Europe since the ban of Russian diesel, any supply shocks to the Gulf, such as the closure of the Strait of Hormuz, would have substantial impact on the European diesel market. And although the strait remained open for the duration of the conflict, the massive price movements that we saw since the start of the hostilities were largely driven by market sentiment, with traders pricing in fears of potential disruptions at a time when European inventories are already tight. So as a result, we saw the front-month diesel futures contract surge to a near year high of almost $800 per metric ton on June 19th, while the prompt spread backwardation, which is a key gauge of market tightness, soared to its highest levels since February 2024. But as I said, a lot of these movements were sentiment rather than fundamentals driven. So when the ceasefire was announced on June 24th, we saw a massive correction in the market, with front-month futures plunging from nearly $800 on June 19th to just 670 on June 24th. So although the market has definitely eased as the ceasefire seems to be holding up, it's definitely still not a well-supplied market at the moment. The backwardation is well above the levels we've seen this year and even most of 2024. It is currently hovering around the levels last seen in March last year, which suggests that the market is still experiencing substantial tightness despite the risk premium largely receding. And this has primarily been driven by a patchy US arbitrage in recent weeks as well as lower imports from Saudi Arabia, both key sources of diesel supply for Europe. Although diesel exports from the US increased towards the end of the month compared to the first three weeks of June, market participants all said they didn't feel the volume or they weren't very tangible. And this is because European inventories had already been low for some time. Meanwhile, demand has increased seasonally. So for instance, diesel stocks in ARA plummeted to a 17-month low end of last week, lowest levels since January 2024. So it makes sense then why even if imports marginally increased in the last week or so, they were not necessarily felt in the market. Clearly it looks like Europe needs a lot more volume to offset the rise in demand and falling inventories. And this is why any hint of supply disruptions, like the recent tensions in the Middle East, trigger an overreaction in the market, which had already been on edge from tightness. Gary Clark: I see. I understand, Nadia. So the diesel market, it's supplied, but it's still relatively tight. And you're talking... And there's the degree of risk premium still built in to the price because of the tensions in the Middle East and the potential risk of a closure to the Strait of Hormuz, et cetera, et cetera. But it's fundamentally, it's tight, and you're saying it was tight going into the conflict in the first place. Is that right? Yeah. Okay. And so in terms of jet fuel, Virginie, what are the fundamentals for jet fuel at the moment? Virginie Malicier: Yeah, so the market seem quite well supplied going into the peak summer demand period. So what happened is before the start of the conflict between Israel and Iran, the market was quite balanced in Europe, so there was very strong demand expected for the summer. Trader were seeing demand similar to 2019 level, so back from pre-pandemic in term of jet fuel consumption despite an increase in engine efficiency. On the other hand, we had a lot of flow coming from East Austria, around 2.3 million ton in June compared to 1.7 million ton in May. But that is in order to cover the demand that will grow until the peak week of beginning of August. But in term of cracks, we were seeing jet and diesel quite neck and neck for most of the past few years. But before the conflict in the Middle East of June, we had jet fell slightly ahead of diesel by around $1 per barrel above diesel. So basically jet was around $17 per barrel, diesel at 16. And now, we can see that both crack increase of product on June 13 and then when the US launched some missile on the nuclear sites. So crack increase a lot of June 18 and June 19. But now, they're still at elevated level, but with diesel above $3 above jet, so diesel at $23 per barrel and jet at $20 per barrel. Gary Clark: That's very interesting. So you're painting a picture here of where there's been little between the diesel and jet fuel markets, and typically you might see in the summer months the jet crack above the diesel crack because, like you were saying, you're going to that peak flying demand period. But you're saying right now, I guess given this diesel tightness and all the risks that are out there to supply, diesel is above jet in terms of the crack spreads. Virginie Malicier: Yes, actually that confirms what Nadia just said about the risk of supply disruption being more priced in the diesel physical crack even, and also the fact that the jet market is currently in Europe better supply than the diesel market. Because what has happened is when the conflict broke out, people stopped offering cargo, everyone was on the bid side, and so many jet cargo were bought, but flow at the end were absolutely not disrupted. So that's why we have a temporary small overhang of jet cargo in Europe. But in term of physical premium, if I look at cash differential versus the front months ICE LSGO, on June 9th they were at $36 per metric ton. Then on June 13 they had increased to $57.25 per metric ton. And now yesterday we assessed CIF Northwest European Jet Cargo at a $36 per metric ton, a premium over the front months ICE LSGO. So we are kind of back to the level where we were before. But what remains in term of difference is really that currently refiner have a small incentive to produce more diesel than jet fuel. Gary Clark: Obviously you've mentioned... We've been talking about supply risks, and the obvious one, Israel-Iran, but I also mentioned at the beginning we've had this European Commission-led proposals to essentially ban the importation of oil products into the EU which are made from Russian crude. So what's the latest on that situation? Because obviously that would have a big impact on supply into Europe. We know for instance, 25% roughly of European jet fuel imports come from the west coast of India. We know that west coast Indian refiners use Russian crude as their feedstock to produce that jet fuel. So what's the latest with the situation on that? Virginie Malicier: Well, for the moment, it's a proposal. So it would change a lot in term of supply into Europe, like you said. So around, yes, 23% of jet will come from west coast India, and also you have some coming from China and some coming from Turkey for the mid-market. So these three country that also will supply Europe with diesel. And basically the refinery use Russian crude oil. And some refinery, like the Reliance refinery in India, it's well known that they have signed a longterm contract to get the Russian crude oil supply. So it'll be not so easy for them to switch. But also there's a Turkish refinery, which supply as a mid-market with jet and some diesel, have a little bit more of leeway in terms of their crude slate, because when there was some sanction against the shadow fleet in January, we know that some of them tried to get different crude supply to replace some of their Russian crude supply. But overall, people so far, they don't know whether the sanction will be applied or not, because there is a proposal from the European Commission, but nothing has been voted yet. And so Nadia has more to say about the matter of the impact. But for me, the main danger in term of supply would be if the EU say, "Tomorrow we ban the import of oil product made in refinery which process Russian crude." Because if the sanction applies from one day to another, then it's mean that many cargo will have to divert. Many cargo planned to go to Europe will have to divert and we will see the supply elsewhere. Gary Clark: Obviously this is a risk right now. The market's very much in wait-and-see mode. And I hear what your sources are telling you around that, Virginie. So Nadia, what are your market sources telling you about what the potential impact on the market could be if this ban were to come into effect? Nadia Bliznikova: At least in diesel, the market didn't really seem to react very much to this news. We've already seen how adaptable markets are and how global flows can rearrange themselves to work within new dynamics. So the general market sentiment is that the impact of this, if enforced, will be rather minimal. At the end of the day, the global balances won't change, and products from Russian-origin crude will go to the east or to West Africa, while Europe will be of offset by more Middle Eastern supply. More Russian product could also go to South America, which would free up additional US supply for Europe. And besides Indian or Turkish refiners, yes, could adjust their balance of different crude intakes and get more crude of a different origin to substitute Russian. But the market participants think that as long as number of exports volumetrically do not exceed the number of crude intakes coming from Russia, we are unlikely to see a huge difference in the market. And if enforced, the ban could have some short-term impact, but it is unlikely to be held up in the long term. Gary Clark: That's understood. And I think you mentioned essentially market resilience in the face of supply disruptions and risks to supply. The market has been incredibly resilient since the onset of the Russia-Ukraine war in terms of that rearrangement in flows, which ultimately sees the supply fundamentals kind of settle down. Well look, thank you very much. It's a fascinating conversation on diesel and jet fuel. As always, markets are fast moving, and now more so than ever given the supply uncertainties in focus, with maybe the Israel-Iran conflict lately overshadowing the potential impact posed by any new European legislation. So keep up to date with Platts LIVE, the professional platform built exclusively for the energy industry. Have your say and join the conversation at plattslive.com. Thank you Nadia and Virginie, and thanks for listening. Recommended

Energy Evolution

Explore the shifting energy landscape with leading experts as commodity industries aim to rein in greenhouse gas emissions and their impact on a changing global climate.

Podcast

Jul 01, 2025

Metals Co. CEO says ocean mining permit coming 'sooner than people expect'

Metals & Mining Theme, Energy Transition, Non-Ferrous, Renewables July 01, 2025 Metals Co. CEO says ocean mining permit coming 'sooner than people expect' Featuring Taylor Kuykendall In this episode, host Taylor Kuykendall speaks with Gerard Barron, CEO of The Metals Co. Barron and his company are looking to mine the ocean floor for metals like cobalt, nickel, and rare earth elements as demand for the materials surges due to the rise of renewable energy technologies and electric vehicles. Barron discusses the potential of polymetallic nodules found in the depths of the Pacific Ocean, the technology used to mine the ocean and the environmental implications of mining in such delicate ecosystems. The conversation also touches on recent developments in US policy supporting mineral independence and the challenges ahead as the Metals Co. seeks to transition from exploration to commercial recovery. Also on: Spotify | Apple Podcasts View Full Transcript Taylor Kuykendall: Welcome to Energy Evolution, where we explore the latest trends and innovations shaping the energy landscape. I'm your host, Taylor Kuykendall, and today we're diving into a topic that's making waves in both the environmental and economic sectors talking about deep sea mining. Deep sea mining involves the extraction of minerals and resources from the ocean floor. Now, as the demand for metals like cobalt, nickel, and rare earth elements rises driven by the growth of renewable energy technology and electric vehicles, companies are starting to turn their sights to some more extreme locations to find some of these materials, including the ocean depths. Now, the mining process involves these remotely operated vehicles that are equipped with specialized tools to collect nodules from the bottom of the ground and bring them to the surface. This technology is fascinating, but it also raises significant environmental concerns. The ocean is a delicate ecosystem and disturbing the seabed can have far-reaching consequences, disrupting habitats, and threatening marine life. So do be aware that there are some people that are pushing back on some of the development here. Now, what they're actually looking for when they go underwater is looking for these things called polymetallic nodules. They're small potato-shaped rocks that contain these valuable metals that they're looking for. They form on the ocean floor over millions of years and can be found in abundance in certain regions like the Clarion-Clipperton Zone in the Pacific Ocean. Now today, we're welcoming back Gerard Barron. He's CEO of The Metals Company. They're working to mine the ocean floor. Earlier this year, The Metals Company formally initiated a process with the National Oceanic and Atmospheric Administration under the U.S. Department of Commerce to apply for exploration licenses and commercial recovery permits under existing U.S. legislation. Let's just dive right into that conversation that we had with Gerard now. Hi, Gerard. Thank you so much for joining us back here on Energy Evolution. Just to start off with, can you give us a high-level overview of The Metals Company, what we're talking about when we're talking about deep sea mining and what it is exactly we're down there looking for? Gerard Barron: Yeah, so The Metals Company are focused on developing ocean metals, and so think of the planet as 70% ocean, yet we get no metals out of those very same oceans, and we're focused on a deposit about 1100 miles southwest of San Diego. It sits 4,000 meters below sea level in the form of polymetallic nodules. And if we go back to that global picture again, 70% of the known reserves of nickel and cobalt and manganese sit in this one deposit. And if I was with you, I'd hand you a nodule that's about the size of a potato. They literally lie unattached on the ocean floor and so what we've been focused on over the last 14 years is understanding the resource, how big it is, understanding what's the most efficient way of picking up these rocks causing the least impact, and then also studying what the environmental impacts will be of removing them from that ecosystem. And so we're now getting to the final stages where we're about to seek a permit to enable us to move from the exploration phase into the commercial recovery phase and we're doing that through the United States government. And this resource represents an opportunity for us to ship those metals to the USA and help make America mineral-independent a little bit like it became energy-independent with the development of shale oil fields. Taylor Kuykendall: And I'm wondering too, one of the big developments we saw recently was an executive order from Trump supported this kind of activity. Can you tell me a little bit about what exactly that meant and how The Metal's Company's kind of mission fits into what the administration's thinking these days in terms of mineral supply chains? Gerard Barron: Well, we know that the current administration under President Trump have at the core re-industrialization and they need to bring back jobs, they need to secure supply lines. And that means you need to go and find where you're going to get these metals from because of course if it ain't grown, it's mined. And of course, what the West has done, including the USA, is over the last decades depended heavily on other parties. China and Russia are two that come to mind. And I guess when COVID arrived, it showed what happens when you interrupt a supply chain and it means that those industries that use those metals as their foundation can't continue, can't develop. And of course, in the last several decades we've seen America lose those industries to other developing countries, particularly in Asia. So what the Trump administration are very focused on is how do we secure the supply lines? How do we bring back those jobs, bring back those industries into the United States? And so when the Trump administration was elected and the cabinet was chosen, we made the decision that we would seek permitting through the U.S. agency, NOAA, where the exploration and the commercial recovery rules already exist to enable us to lodge that application. And so we announced at the end of March that in fact would be our intention and, of course, we saw the executive order come out on April 24. And what that really did was say, now we want to fast track the development of these resources that we, America, have access to both in our territorial waters and also in the expanse of waters and that's what we're going through the permitting process now with the federal agency. But the executive order was an amazing boost for us and it certainly focused the minds of those permitting agencies. Taylor Kuykendall: So what sort of timeline do you think you're looking at now that all these developments have happened? Gerard Barron: That's in the hands of the agency. However, the executive order made it very clear, and I know it's a personal wish of the President that we see this resource in production during his 47th term. And of course, good news is we've spent the last 14 years getting ready for this moment and so we've been able to put in front of them a very well-baked application. We've spent nearly, well, more than $600 million carrying out the research both from the commercialization commercial recovery system and the environmental studies. So we've really given them a fully-baked application and we're hoping that we may hear news on that certainly much sooner than people expect and certainly in 2025. Taylor Kuykendall: When I first imagined all this, thinking about how far away some of these resources are from the places where they might be processed, thinking about how deep they are in the ocean and found know much about the technology. And my first kind of suspicion is this sounds expensive. Can you tell me about the economics of this? How it compares to mining on the land and where this all kind of fits into prices today? Some of these materials are not necessarily at their historic highs. Gerard Barron: Well, this resource offers many advantages and one of them is the high grade and it's often grade that is the real driver of the economics. And it's polymetallic so it's very high grades of nickel, and copper, and cobalt, and manganese plus a heap of rare earths. We're not focused on them in the early days due to the processing method we're using, but in future we will. But if we think about copper, because that's the metal that most people are familiar with, and while our resource has 1.1% copper, if we go and put the nickel, cobalt, and manganese into copper equivalent, it's well over 7% copper equivalent. Now last year the average grade of copper mined was about 0.6 of 1%, so we're talking about an order of magnitude higher grade so that has a big impact in the amount of revenue we generate per ton of material. But what people often forget is what happens in mining is you have to invest an enormous amount in infrastructure. It might be because the resource sits buried underground, could be a kilometer, it could be four kilometers. I'd been to some of the deposits in South Africa where they spent seven years building shafts to get to the ore body. You've also got to build roads and railway lines, and perhaps deep water ports, and places for people to live, and water systems and everything else that goes with the development of a big resource. We don't have those same challenges. We have other challenges, of course, but we don't have those and that has a massive impact on the economics because it means that we can convert a production vessel and sail it on out there and be in production days later. And it means that the scale opportunities for us are tremendous as well. It means we put more boats out there and it means that we can take advantage of existing already built and permitted processing facilities in various places around the world, such as we announced we're planning to do up in Japan. But the intention is to build this infrastructure in the United States. And of course, an abundant supply of energy is a really important ingredient. America has it, and the administration is very focused on having more of it with some of the initiatives that they've announced because abundant, affordable energy is absolutely one of the key drivers to prosperity and we're going to need a fair bit of it. Taylor Kuykendall: And there's been some environmental critics of deep sea mining. You just see the other day I saw the bloom of this Greenpeace has a release out saying that there's a threatened whale species in the area. I believe a lot of the criticism has kind of been around perhaps the unknowns of what happens when we begin industrial activities in these areas. Can you just tell me a little bit about The Metals Company's own work to try to mitigate some of these things and maybe your reaction to some of these studies? Gerard Barron: Look, it's the environmental angle that is probably one of the strongest aspects to support the development of ocean metals. And if we go back to first principles, it makes sense that we carry out extractive industries in parts of the planet, where there is the least life, not the most life. And if you look at the amount of living biomass in the abyssal zone, we're talking about less than 10 grams of living matter per square meter. And most of that is single cell organisms living in the sediment. That's 75 to 80% of it. So it begins with the fact that there's not a lot of life there to impact in the first instance. Still doesn't mean it's not important and that's why we've been studying about what the impact will be. Will we actually disturb or will we actually help productivity in that area? And there are some signs that will be the case with some species because it's an area of very low energy, low food. And so we found abundances increasing in nearby areas where we had been down there collecting rocks in our commercial trials in 2022. So when I hear people like Greenpeace talking about potential impacts, they are truly grasping at straws now because we have been focused for more than 10 years on understanding those environmental impacts and we've engaged 20 of the world's leading institutions. They've carried out the research. We funded, of course, but it all fills all channels back into an integrated environmental impact study where we look at a whole range of impacts. We look at the pelagic impacts, and the midwater column, and the benthic impacts, the sediment plume and how fast are recovery rates. And sediment plume is one classic example. And when I say sediment, think of it as driving your car down a dirt track, you'll kick up some dust. The question is how much and how far will it travel? And people like Greenpeace would argue that it's going to travel for thousands of kilometers. But our studies which we sit alongside people like MIT who've also published peer-reviewed studies, shows that down in the abyssal plane, the sediment... Because we take in the nodules in the front of the machine, we separate the sediment and we spit that out the back and it creates its own turbidity current, and it only rises two to three meters above the seafloor and up to 98% of it settles in the area of impact. So contrary to the speculation from desktop studies, when you go out and gather real in-field data, they provide you the answers. And the answers are that the sediment plume doesn't travel those very large distances. It stays very localized. And so my answer to people with environmental concerns is it's reasonable to have them. And, of course, our approach has been to address all of those and the results of those many hundreds of millions of dollars that we've invested, and on top of that, many other contractors have invested since the 1970s. And for your American listeners, NOAA put together a programmatic environmental impact study, which was the work of four EISs done by contractors plus their own work, which they submitted to Congress in 1995. And it basically showed that subject to more studies on the plume, which we have now done, there was no risk of causing serious harm in collecting nodules from the abyssal plane. Our work has further studied that and come up with the same findings. And we also have to remember that nothing has zero impact. But when you look at the two ecosystems and you think about the abyssal plains and hills, which account for 50% of our entire planet, so it's the most common environment. There's no alternative use for it. You can't grow things there, people can't live there. It seems to be a perfect place to be carrying out this activity because today where we're getting our nickel from is from tropical rainforests. And the problem with that is you've got to move all of the people who live in them out. You've got to tear down the rainforest and all of the biodiversity and biomass that is in it, and then you've got to dig up the soil where the metal bearing ore is contained, and that's the beginning of the impacts. Then you have spillage into the oceans and rivers, and honestly, it's such a clear use case to be picking up rocks and turning them into these important base metals compared to the land-based alternatives. Taylor Kuykendall: Excellent. And the last time we were talking, you were looking at permitting, I believe before the International Seabed Authority. Can you maybe give our listeners just a little bit of background about that organization and why we're now hearing about applying through the U.S. instead? Maybe give us a little bit of background and how that came to shift around. Gerard Barron: Yeah, sure. So in 2001, we applied for our first exploration license under the International Seabed Authority. And in 2012, our second one, so first was with Nauru, the other was the Kingdom of Tonga. And if we look at this industry, it almost got started back in the seventies. And then the United Nations got involved and a number of countries decided that the best way to approach this would be to agree a treaty for a number of countries and there are now 169 member countries who have signed that treaty. There are more than 20 who have not and, of course, the most notable one who have not is the United States of America. And the U.S., from the very beginning, said, "We don't agree with this approach. We're not going to sign the treaty. We're not going to abide by those rules because no sovereign has ownership over the oceans." Every nation has freedom of movement, freedom of passage rights. They have access to the minerals on the sea floor. They have access to be able to lay cables on the sea floor. And what America did is stood aside, said, "We still want to maintain those rights." Whereas, the other countries who did sign UNCLOS, as I say, there's 169 of them now, said, "Well, when it comes to minerals, when it comes to metals on the sea floor, we're going to be bound by these rules." Now, in 1994, the International Seabed Authority was established and it had a very clear mandate. It had to put in place exploration and exploitation regulations to allow the commercialization of these resources and while protecting the marine environment. And so in 2001, they put in place the exploration rules, but here we are 2025 and there are still no rules that cover commercial production. And the main reason for that is that the system got overtaken by NGOs and so the process was slowed down, some bad actors became more vocal, and they just used the process of the delay. Now, at the same time, the United States in 1980 adopted a set of rules. We know them as DSHMRA and they're administered by NOAA, the federal agency, which allowed for exploration and also for commercial recovery. And so we made a decision in the second half of last year that's subject to a number of things and one of them was getting a strong government in place that we would change our permitting strategy and apply through our U.S. subsidiary TMC USA, and that's what we're moving forward with. And obviously, the United States are very clear on their rights over these metals. They've held two exploration areas in the CCZ, in the very same area that were granted to Lockheed Martin, and they've been in place for a long time. But it was really the President's focus on reindustrialization, their absolute focus on how to secure supply chain certainty that gave us the confidence that this resource could play a very important role in helping fulfill America's future ambitions. And while the support has come from President Trump, we do see it as a bipartisan issue. We had good support from the previous administration as well. Certainly not the strong leadership we're seeing from this one, but we think the critical mineral challenge is one that will not go away. It will only become more important. And I think that for the last couple of years we've been all talking about bits, we've been talking about AI and these new industries, and of course what people are now starting to realize is that the atoms are super important because we need to build all the infrastructure to supply the energy to enable this to happen and to supply the industry to attract jobs back into the United States. And so it's an exciting time and we're delighted with the support we're getting from this administration, and we're delighted the prospect that we can get this resource into production on a short timeline. Taylor Kuykendall: And now related to that, I'm always curious of whether the market is out there following these trends closely enough to know what's going on. And I think it took a while for people to realize the importance of critical minerals, right. But you've recently announced it a 37 million investment from Hess Capital, I believe it was an $85 million investment from Korea Zinc into The Metals Company. Can you tell me a little bit about first of what the significance of those investments, but also maybe how have you seen the kind of market evolve and its reception of critical minerals and understanding its importance to maybe say energy transition? Gerard Barron: Well, you're right to suggest that people have been a little bit slow on the uptake on the importance of critical minerals, but they are getting it now. We wanted to focus the business more and more on the USA and so we were delighted to see Michael Hess, and in fact, we announced Alex Spiro to join our board only a week ago. And of course, the Hess family are very well known industrialists in the USA. So to have them commit a very sizable piece of capital behind this idea from their family office was a really important initiative because they help manage some of the stakeholders who are going to be very, very important and they've got an amazing track record of building globally successful companies and I'm sure some of that will rub off onto our efforts and it already has. This is not a passive investment. This is an investment, which I imagine they'll probably invest more in the future if the opportunity arises. But what we're seeing at the moment is lots of effort to help us achieve what our corporate goals are. And of course, Careers Inc.is similar. We've known that company... Well, we've known the company for decades, but we've had good dialogue going for the last year and their chairman is very committed to exploring how they can access more USA opportunity. And from our perspective, they are, outside of China, the only company that we think can help fast-track what we want to put on the ground in the United States. And they bring expertise, clearly they bring capital, but it's that expertise which will enable us to move a whole lot faster and with much less risk than we would otherwise be able to. And we have an enormous amount of inbound inquiry coming our way these days since we announced at the end of March that our permitting pathway would be USA-focused. People see that there's some certainty now about us being able to secure a permit to be able to go and develop this enormous resource. And one thing I haven't mentioned, Taylor, is we know we've got a defined 1.6 billion tons on the areas that we've applied for through the U.S. government, and we estimate with some other ground that we've added to the application, there's another half a billion tons. We're talking well over 2 billion tons of nodules sitting on the seafloor that are polymetallic, but if we put them into copper grade are more than 7% copper equivalent. There is no other resource on the planet that fits into that category and so having strong partners who can help us develop this asset in the same way that we have Allseas as one of our most important partners who are experts in the offshore industry, and it was their flawless execution that enabled us to run those commercial trials so well in 2022 because for the past 40 years, they've been solving very complex production issues in the deep ocean. They lay pipe 24 hours a day, 365 days a year when they're on production and so they bring all of that learnings and all of that know-how to help us avoid making mistakes the early stage companies would otherwise make. And we see Careers Inc. and the Hess family coming to help us do that to an even greater degree. Taylor Kuykendall: So a lot of reasons to be excited over The Metals Company. Just to wrap it up, my last question for you is what are maybe some of the challenges that you see in the horizon 2025? What are your maybe biggest hurdles that you're looking to face in the next couple months? Gerard Barron: Well, we're going to be depending on getting this permit on the commercial recovery, of course, but we absolutely want to get focused on building that infrastructure in the USA. We're very encouraged by the administration's support that they've been offering us on how to get processing quickly permitted. Of course, I don't have to worry about capital so much now because not only do we have access to lots of capital on the balance sheet, we'll close the quarter with more cash than we've ever had in the bank. I think the pro forma number we gave was about $120 million. So that's a good feeling. But, of course, capital management is one of those things that we've proven to be pretty good at, but we've now got more expertise around the table and the Hess family help with that. Of course, Alex Spiro brings an enormous amount of expertise in that area as well so we're very happy to have his services available to us as to Careers Inc. But managing that capital so that our equity holders get the best return on their invested capital is always of the highest priority for me. Our shareholders have been amazing to support us. We're enjoying building a strong retail support base as we are welcoming institutions. If you look at the forms that have been filed now, you see some of the world's biggest institutions turning up on our share registry, and I think providing... We continue to show them that we look after their capital, then we'll continue to see that group of institutional owners grow and grow. So it's going to be an exciting little run in into first production, and we've been at this for 14 years and we're just grateful for the fact that President Trump and his administration is clearing a pathway to help us make this happen quickly. Taylor Kuykendall: Excellent, Gerard. Thank you so much for joining us in the day and look forward to having you back for another update soon. Gerard Barron: Thanks Taylor. Taylor Kuykendall: All right, listeners, thank you so much for listening to the latest episode of Energy Evolution. I want to give a special shout out to our incredible podcast team members. I am once again, Taylor Kuykendall, but some of the other people that work for this podcast include my co-host, Eklavya Gupta, Camilla Naschert, Christopher Coats, Dan Testa, Karen Willenbrecht, and our wonderful agency partner, The 199. To stay up to date with our upcoming episodes, be sure to subscribe to Energy Evolution on your favorite platform. If you have any ideas for future themes or guests, we'd love to hear from you. All you have to do is shoot us an email at energyevolution@spglobal.com. And look, if you liked what you heard today, do consider sharing the podcast with others or leaving a review on your preferred podcast platform. We can't wait to bring you more fascinating discussions in the future. Until next time, take care and stay tuned for more from Energy Evolution. Recommended

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Jun 25, 2025

What might the second half hold for Europe's chemical industry?

Chemicals June 25, 2025 What might the second half hold for Europe's chemical industry? Featuring Andy Orszynski, Yazmine Khan, and Daniel Pelosi S&P Global Commodity Insights research directors Andy Orszynski and Yazmine Khan join price reporter Daniel Pelosi to discuss the outlook in Europe after June 10's European Petrochemical Luncheon in Munich. Key topics include ongoing capacity rationalization, what LyondellBasell's cracker divestiture means for efforts to sell European assets, and whether there is any case for optimism in the industry. This episode was recorded on June 20, and references some recent events. View Full Transcript Yazmine Khan: With everything that's gone on through the first six months of the year, it's likely that our estimates in terms of demand and general fundamentals will all be revised down. Daniel Pelosi: Hello, and welcome to the Chemical Week Podcast by S&P Global Commodity Insights. I'm Daniel Pelosi, the Senior Price Reporter for European Benzene and Styrene at S&P Global Commodity Insights, and today we're looking to reflect back on some of the dynamics across the first half of the year in the European petrochemical industry in a period which has seen wide trade uncertainty, a volatile geopolitical backdrop, and ongoing concerns surrounding structural demand and long-term industry viability in an oversupplied environment for most markets. It's quite well-timed to reflect back on the first quarter of the year. Last week, a variety of industry players from across the olefins, intermediates, and aromatics markets attended the second European petrochemical luncheon of 2025 in Munich, Germany to reflect on conditions, discuss outlook for the rest of the year, and begin planning for their considerations and stocking for the rest of the year. And myself and some of my colleagues from the analytics and pricing teams were present at the conference, so we'll use this as a kind of focus to discuss the key trends and outlooks for the second half of 25. So to do so, I'm joined by my two colleagues from the analytics team here at S&P Global Commodity Insights, Andy Orszynski's, the Director of Ethylene and Derivatives, and Yazmine Khan, the Director for Aromatics, it's great to have you guys here. So we'll start with just a broad kind of discussion on the conference as a whole before getting into some of the nuances of the discussions that we had throughout the week. And probably worth noting as well that it's been about a week since the conference as well, we've had a wide variety of developments in the market, even just in the seven days since the conference concluded. So yeah, we'll swing this round the room, but starting with Yazmine, following the conference in Antwerp in the first EPL of the year, which was dominated by broad uncertainty as a result of tariffs and geopolitical tensions, for Yazmine, on the aromatics side of the industry, what were the key talking points from the Munich event and did you see much of an improvement or more optimism in industry sentiment compared to the Q1 event? Yazmine Khan: I'd love to say I did, Daniel, but it seems the mood is very much the same as Antwerp, a lot of uncertainty surrounding tariffs, geopolitical tensions still, and then I think the other thing is that demand continues to struggle and people really see no light and no clarity as to how demand improves over the coming year. People are really sort of struggling to see any sort of good news on the horizon, demand remains depressed, and operating rates across most aromatics producers or benzene derivative producers remain relatively low. Since the conference, there's also been some announcements about some further closures, which we can go into a little bit later. But for EPL itself, still a very sort of downbeat mood with no clarity over the coming months for producers and consumers alike. Daniel Pelosi: Yeah, agreed. And from the aromatic side, specifically in my conversations on the benzene and styrene side, quite a lot of just realignment of attitudes to markets for the rest of the year, given the consistency and sentiment and underlying fundamentals across the industry. I had a comment from one producer of styrene, who when asked about current outages in the market, his attitude was essentially, "Well, who cares who's on or offline?" The underlying demand is so weak and has been for the bulk of the year that it's difficult to reckon that with any substantial change in conditions. To swing to the olefins and polymer side, Andy, what were your key takeaways from the Munich event and did you sense any change from the first quarter? Andy Orszynski: Again, not hugely. I think all of the topics we've mentioned so far, so obviously conflicts and escalation in the Middle East actually started breaking out whilst we were there, tariffs, still a hangover from that and some uncertainty, and obviously the recent announcement by [inaudible 00:04:06], which I'm sure we'll get onto in more detail shortly, all of these things that were obviously topics, but I think the one thing underpinning it is still European competitiveness. So if we're talking tariffs, people are immediately concerned about the impact on trade flows and imports and how competitive or more competitive they might come compared to European production. Obviously the rationalization piece is big when it comes to European competitiveness and oil price impact as well. People are looking at trying to see what's going to be happening with oil, and I know we as S&P Commodity insights have a relatively bearish outlook on oil, or at least we did until things escalated between Israel and Iran last week. So people again are asking that question to try and find out where Europe's going to be sitting on the cost curve in six months time. So I think for the audience at EPL, these are people running the P&L, these are people very much keeping the business running here today. So that near term outlook and how competitive and how much volume they're going to be selling and how much margin is going to be made this year is underpinning every conversation that we have. Daniel Pelosi: And I think important to stress that those underlying conditions really do continue to be the key trends in the market despite the broader volatility regarding geopolitics or underlying tariff discussions to stick with olefins and Polymers for now, you mentioned, Andy, the discussions right before the conference surrounding LyondellBasell's pre-conference announcement of the divestiture of four of their strategic review sites to German private equity firm, Aequita on the kind of ethylene and a broader olefins side of the industry. What was the conference's reaction to the LYB announcement and would you say divestiture is seen as a viable option for combating the continent's structural issues? Or is capacity closure still seen as the strongest route out of the structural oversupply that really dominates some ways on European margins? Andy Orszynski: Well the Lyondell one is really interesting. Obviously the industry had been anticipating the outcome of this review for quite some time, and I think perhaps for a number of people, the assumption that at least a couple of the sites and possibly one if not two of the crackers at [inaudible 00:06:20] would be closing as a result of this review. So I think perhaps a surprise to some that the divestment route is where we are and that these two crackers, at least in the near term, won't be helping the oversupply situation and they will be staying online. When it comes to the structure of the deal itself, private equity, this is the first time private equity has got into steam cracking itself. We've had plenty of PE in various parts of the chemical value chain with I think mixed outcomes over the years. So the first time private equity has bought steam crackers. I guess there's two sides to this. There's the cynics in the room and there were the optimists. And I think the optimists want to say, okay, maybe private equity sees something that the industry doesn't. Maybe they look at the fixed cost position and the ongoing CapEx in this industry and think something can be done, some costs taken out and competitiveness improved. Maybe they're betting on everyone else over rationalizing, maybe they're betting on some stronger political support for Europe that's going to help the competitiveness, or maybe they're betting on lower oil and higher gas prices over the next few years. So I think that there's plenty of people that say, look, this deal could very much be in good faith. Then you've got the cynics in the room that they see this as a way of Lyondell getting rid of some liabilities. So if the plan is closure, then perhaps there's a view that the liabilities on those sites for Lyondell are greater than the cash contribution they've given as part of the deal, and that perhaps private equity can find a way of exiting these sites for less money than that. And unfortunately for many people, that's the deal equation that they see, which is unfortunately perhaps seeing that private equity is a route to exit rather than a route that sees future for these assets. Daniel Pelosi: Thanks very much, Andy, and certainly still lots of questions to be answered regarding the broader supply picture and the need for potentially further action here. Yazmine, on the aromatic side of the industry, where there any new developments or previous developments on the potential rationalization or unit future side discussed and is divestment seen as a possibility for underperforming units on the aromatics and phenolic side of the value chains? Yazmine Khan: So EPL, the discussion was still very much around, like Andy said, sort of survival of the industry, high energy costs, the high cost basis generally in Europe. And though it wasn't discussed in Europe, the question was put forward as can Europe survive as it is or do we need some rationalization in the industry? Particularly when talking about the phenolics with operating rates being in the sort of mid to low 60 odd percent across Western Europe at the moment, having returned from EPL this past week over just over the last couple of days, they have been some quite important announcements around this chain. First of all, we have Westlake announcing that their BPA and epoxy resin asset in Pernis in the Netherlands will be permanently shut down. And then further to that, we also had an announcement from INEOS Phenol that they will be permanently shutting their Gladbeck asset at likely around the 2027 timeframe, at which point INEOS will then look to restart their Antwerp asset. The Antwerp asset has capacity of 680,000 metric tons, but it's two lines. So Antwerp is two lines, one of 240 KT and one of 440 KT. It's also the newer assets, so that allows them some flexibility between lines and also a newer plant. So we have INEOS one of their assets in Europe, and we also have BPA rationalization, which will remove between 60 to 80,000 metric tons of phenol demand from the European market that doesn't come back. So we are seeing some rationalization. However, I think with demand continuing to fall away in terms of BPA, polycarbonate, the nylon chain continues to perform quite poorly as well. I think there is still a question mark about some further rationalization in Europe. Prior to EPL was the announcement from PKN Orlen in Poland that they were to close their phenol plant there as well. But it's only a small asset now 55, 60 KT. So without going it's a small amount shifted from the overall European market, but that is still not enough. I think there is potentially some room for some further rationalization in Europe if we don't see a pick-up in demand. But I think the final thing that I would add is even though INEOS have announced the permanent closure of Gladbeck, they will be restarting the Antwerp unit once that closure happens. So the net impact of that closure in Europe in terms of supply is very, very minimal. I think the actual bigger picture and the bigger story here is that they have chosen to permanently shut an asset in Europe with INEOS citing legislation, high energy costs, and Europe's general uncompetitiveness is one of the main reasons for that. Daniel Pelosi: Indeed, a lot of different moving parts here, and I think in addition to this, there really continues to be a great deal of uncertainty and volatility provoked by the international trade environment at the moment with regards to still potential tariff initiations from Washington and shifts in global trade flows as a result of a more isolationist policy by a variety of players across the global sphere. I wanted to touch on this and the view from the conference. I think on my side on the benzene and styrene markets, we do see this continues to weigh quite heavily on potential arbitrage. I think outside of structural flows, it's very difficult for players at the moment to take advantage of potential arbitrage in the market. I had a comment from one source that to ship benzene to Europe at the moment is on a spot basis resulting in consistent 10 to $15 losses. So the arbitrage is essentially impossible. But on your respective value chains, how were stakeholders approaching the current dynamics surrounding tariffs in their discussions at EPL? Have they adjusted their approach to operations and planning in this more volatile international trade environment? Yazmine Khan: So in terms of tariffs and the volatility there in Europe, what we don't see is we don't see too much trade. We don't see too much movement of phenolic from Europe into the US. What we do see is some phenol moving from the US into Europe, and what we're expecting is those flows to probably slow down a little bit given the US has higher benzene costs and higher RGP costs this year as well. But overall, generally given that European demand is so weak, we are not seeing a huge impact in terms of phenol and derivatives. Where we do see an issue is in terms of those protectionist measures that you mentioned, Europe seems to be very much going down a line of anti-dumping duties. There's a lot of rumblings around anti-dumping duty investigations or producers in Europe looking for anti-dumping duty investigations over the coming year, to six months to a year. So I think that's the bigger concern for Europe in this chain, particularly in the nylons, we are hearing rumblings of producers pushing for anti-dumping duty on polyamide or nylon. An anti-dumping investigation is currently ongoing on adipic acid from what we understand. So all of this is a much bigger focus for the European producers of phenol derivatives rather than the tariffs themselves at the moment. The one caveat that I would add to that is if the US does have tariffs on Asian materials and Asian phenol derivatives, what we are likely to see is Asian producers, the South Koreans, the Taiwanese, and potentially even the Chinese looking for another outlet for their material. So what we could see is that volumes that did flow from Asia into the US could then start being rerouted into Europe, which would be a disaster for the European markets given the demand remains so weak. Daniel Pelosi: Thanks very much Yazmine. Yeah, key insights there in the site of more busy, more busy trade flows between Asia and Europe. Andy Orszynski: So when it comes to tariffs on the olefin side, there's not a huge amount of olefin trade globally. There's a little bit of structural imports coming into Europe, some of which does come from the US, but generally monomer is less than 3% of global production actually finds its way traveling into regionally. So not a huge impact on olefins. I think on the ethane side, it's obviously made the trading environment much trickier. I think several traders, very unhappy with the current situation and volatility, the lack of predictability that's been going on. And I think we see volumes from the US to China definitely down and probably unlikely to pick up significantly now until things are resolved and a little bit of certainty is given. So I think a few people burnt and cautious around that. And I think overall it does just give a little question around the US as a trading partner. I think there's a few people that were basically just saying, look, maybe it's more competitive, but at the moment there's just too much risk involved of, and escalation between parties and trade deals and things having their cost positions change whilst they're on the water. So I think a little bit of cautiousness around some of those trade flows and the business that's being done with the US at the moment. Daniel Pelosi: Agreed, and I think we certainly see this materialize in the day-to-day market conditions, increasing discussions on the benzene side of things regarding or rather the styrene side of things, regarding the sourcing of Chinese material. I think with, it's still a very volatile situation in the Red Sea, but potentially seeing slightly more import offers in the market on some downstream products like polypropylene. So seeing a slight adjustment here in what is a very, very volatile environment. Turning to demand more so as well. I think on my side at least one of the key trends remains the difficult domestic construction and automotive conditions in weighing on any wholesale improvement for appetite for chemicals generally. We'll start with you, Yazmine, on this side. What was the view on downstream demand and derivative conditions from aromatics players during the conference? Is a kind of unlikely upswing in chemical pool from automotive or construction industries expected? And what was the view on what is required to restore appetite from material across the aromatics value chains? Yazmine Khan: So reverting back to the phenol and acetone side of things, from my perspective, there wasn't really any hope that demand was really going to improve in Europe. People are still very much looking at a pretty slow remainder of 2025 and potentially going into 2026 as well. I think the issue that Europe has as well is not only is demand weak, but because of high cost production costs in Europe, Europe is continuing to see imports coming in throughout the chain. So in markets that Europe had traditionally been a net [inaudible 00:17:41] because of the over capacity globally, because of the fact that China has become self-sufficient on some of these chemicals, other participants in Asia have to look for outlets for their material because China is no longer a home. And unfortunately for Europe, because Europe is such a high cost region, Europe is going to be that outlet. So we've got weak demand as the underlying fundamentals. But on top of that, Europe is getting more and more import in of some of the other derivatives. So if we look something like again, phenol, if we are getting BPA imports coming into Europe, epoxy resin imports coming into Europe as well, despite the anti-dumping duties, adipic acid imports coming into Europe, these are products that Europe used to be a traditional end, used to be a traditional net exporter of and is now becoming a net importer of. So I think that's the other path to the improvement picture. One, there is the fundamentals about the demand, but the other side is that Europe continues to attract huge volumes that imports from Asia, which is then displacing domestic demand for those feedstocks. Daniel Pelosi: Indeed, and to swing around to Andy, I think there's particular relevance here for you on the automotive side of this discussion. You gave a talk during the conference with our colleague in the S&P Global Mobility team on automotive industry dynamics and their ramifications for the chemicals industry. Could you give a quick summary on the key points of your side of the presentation and did you see those insights reinforced by the sentiment and discussions with the conference attendees? Andy Orszynski: Yeah, starting with the macro on automotive. Automotive is a debt-driven industry. Most cars are purchased on some form of finance. So given the interest rates as they are and the overall consumer sentiment, which things like tariffs and conflicts in the Middle East don't help with, automotive is not looking great at the moment. Longer term it's always there though, right? It is still a growth sector globally and cars are an essential part of everyday life and have a limited lifespan, so do get replaced. So even though we talk down a lot about the automotive industry in Europe and it is on decline, it is not going to decline down to zero. So we are away from our peak of around 2017 of producing in excess of 20 million cars in Europe and we're down about 20% on that. But that is expected to come back and grow, albeit perhaps not to those levels. I think electrification is a key theme that is on people's mind and I think the key message on electrification is we need to be careful about the broad sweeping statements we make around it and realize that the devil is in the detail. So it's very easy. People say, oh, we want to be lightweight in cars because batteries are heavy, so that's good for plastics. But we've been lightweight in cars for 20, 30 years, if not more, because of tailpipe emission targets and getting cars lighter weight. And actually that tailpipe emission isn't an issue with an electric car. The weight of the car is only an issue because it impacts range and you can improve range through other means. Batteries getting more efficient, batteries themselves getting lighter. So there's a real mix of impacts depending on the polymer with an automotive, some polymers are no longer needed. For example, you don't need PE or PP for a fuel tank in an electric car, but you do need battery casings and components within the batteries themselves. So it's one that I think we just need to be cautious around how broad we make statements and actually to really do the homework and look into the detail of those things. I think the biggest risk for petrochemicals in automotive is the end of life vehicle regulations that are coming into force and now mandating that 20% of all plastics used in vehicles need to be from recycled sources. And so that has a big impact potentially on virgin polymer demand. Daniel Pelosi: Yeah, very true. And particularly interesting in what is a difficult costing environment for the automotive producers. So it's one to keep an eye on for the rest of the year. And- Andy Orszynski: Something I learned though it was very interesting is that when we talk about sort of tariffs and anti-dumping et cetera, and sort of taxes that are put on Chinese vehicles, actually is in a positive sign potentially for our domestic industry is one way that Chinese vehicle producers are trying to get around that is by actually producing in Europe. Now where the components come from is still a question, but we're actually seeing Chinese producers opening plants or planning to open plants in Europe over the coming years and potentially provide support to our automotive industry, albeit perhaps with different owners than we're used to. Daniel Pelosi: Indeed want to keep an eye on for the rest of the year as well. And with that in mind, turning to the final question here to wrap things up, I think it's important to touch on outlook. I think from our side on the pricing team, short term wise, from the meetings I was sitting in during the conference, it's still pretty pessimistic. I was discussing with Yazmine briefly before on the volatility that we're seeing in the upstream crude and naphtha complex and the potential negative impact that's going to have on some players in their margins for the summer periods in a season of the year that typically is very quiet and we see difficult conditions at the best of times for players in the industry. A question for both of you, of course, but what is the view from both the industry and the Platts analytics team respectively regarding the outlook for the second half of the year in both market fundamentals and industry prosperity? And know kind of tying this to EPL, do you expect a substantial change or shift in dynamics by the time of the Valencia conference in Q4? Yazmine, let's start with you on this one. Yazmine Khan: I'm not really expecting too much change, to be honest with you. I think as we look to review our 2025 forecast, it's likely we will be revising down our demand estimates that we had put in late 2024. So coming to the end of 2024 when we were working through our supply demand updates, we were expecting that 2025 was going to be a relatively stable, maybe a slightly better year compared to 2024. Now with everything that's gone on through the first six months of the year, it's likely that our estimates in terms of demand and general fundamentals will all be revised down when we redo our forecasts. So yeah, I'm not really expecting too much change. It's a very volatile environment. Some of these situations could very easily and very quickly be rectified in the next few days. So I think there's still that element of volatility there. But generally in terms of mood and outlook, I'm not expecting too much change. The market is generally pretty hopeful still I think for 2026, but I think that's been a mark of the European industry as a whole. We continue to say the next six months will be better than the current six months. Daniel Pelosi: Indeed. Yeah, no, very true. And Andy, on your end, on the olefin side, similar expectations? Andy Orszynski: Yeah, the word hope resonates strongly there. Several people telling me, oh, second, half of 26 things should start to get better. And I would ask the questions why and the rationale behind that and didn't often get to particularly compelling answers. I think a couple of signposts people are looking for is a peace deal in Ukraine, which should hopefully provide some positive news for the construction industry and obviously for the country itself. I think a filter down of the German infrastructure fund is also I think, hopeful that this stimulates a little bit of demand in construction. So those are probably the couple of events that we see that maybe get some demand lifting above these baselines, but certainly in the next six months from a demand perspective, not really any changes predicted. Think notwithstanding the volatility, there are a couple of fundamentals we expect still to play out over the next six to 12 months around feedstocks. One is rising gas prices in the US with LNG coming online and potentially dropping oil prices in light of OPEC plus production increases or reversal of cuts. Now, notwithstanding the volatility in the oil price at the moment, I think there's a view that those two dynamics will still be going on, and that is ultimately, again, a hope that the competitiveness of naphtha-based steam cracking improves, which is obviously good news for Europe versus the Middle East. So I think, yeah, certainly some hope and some of it around pricing and margin, but I think on the demand side in the next six months, probably not much optimism out there. Daniel Pelosi: Certainly and a lot of hope to really focus on for market participants, especially as we know, we look to realign and to consider plans for 2026 and then the second half of the decade. We could discuss these trends all day, I'm sure, but unfortunately, we have to bring today's podcast to a close. So thank you very much Yazmine and Andy. Really, really insights from your side and let's hopefully do another one of these by the end of the year. Yazmine Khan: Thank you, Daniel. Andy Orszynski: Thanks Daniel. We'd love to speak again soon. Daniel Pelosi: Thanks, and thanks to you guys at home for listening. I've been Daniel Pelosi and this has been The Chemical Week Podcast by S&P Global Commodity Insights. Recommended