Crude oil prices that continued to fall due to a rise in inventory levels as per the weekly report, rebounded on Wednesday. The rally was caused by several factors: signs that OPEC producers are complying with their announced cuts, forecasts of snow storms in the Midwest and Northeast, and the rising belief that the recent downtrend is over. On Tuesday, a federal government announcement to add to the Strategic Petroleum Reserve this spring by 100,000 bpd to boost the nation's emergency oil stockpiles, sparked a price hike. Crude settled at US$55.37 on the New York Mercantile Exchange, after dropping as low as US$53.66 after the inventory report was released.
Market players were quite passive as operation rates at VCM plants across Asia were kept at low levels due to tight availability of ethylene resources.
As buying sentiments were lifted by surging crude oil values, Asian benzene prices soared on Wednesday by US$35/mt and Styrene Monomer prices shot up to the level of USD1,225~1,235/mt FOB Korea for March. Unexpected cracker troubles at S. Korea's SK Corp. and YNCC have limited availability of ethylene across Asia.
Despite another sharp gain of ethylene prices, HDPE prices were pulled down further. General buying interest in LDPE and LLDPE was witnessed to be subdued across the Asian region influenced by a plunge of HDPE prices.
25-Jan-07 
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