Mid-East petrochem producers to be affected by dip in China’s growth?

06-Jun-07

Experts have begun to doubt the sustainability of China’s growth rate at 10% for the next 20 years at a time when Middle East producers’ have been rapidly building up capacity to take advantage of strong global demand, particularly from Asia, and the comparatively cheap local price of natural gas. Will Middle East petrochemical producers, who have been augmenting petrochemical capacity to meet a surge in global demand, need to prepare themselves for a dip as growth in China is unlikely to be sustained? Middle East countries plan to spend US$395 bln between 2007-11 on energy-related projects, of which almost US$ 80bln will be for petrochemicals. Saudi Arabia- theregion’s biggest petrochemical producer, plans to more than double output to 100 mln tpa by 2015 from the current 45 mln.