Several refineries and petrochemical companies, mostly in Asia, have been forced to cut runs and declare force majeure as the U.S.-Israeli war on Iran disrupts crude and feedstock exports from the Middle East.
Asian steam crackers, which source more than 60% of their naphtha feedstock from the Middle East, have been quick to declare force majeure on petrochemical supplies to customers.
Three operators told Reuters they are curtailing run rates to roll over some of their feedstock into next month so they can keep plants running and avoid shutdowns even if imports fall short.
It takes up to two weeks to restart a steam cracker unit, two operators said, and plants typically don't keep more than one month of feedstock on hand.
Here are some of the latest developments:
TAIWAN
Taiwan's Formosa Petrochemical Corp has issued a force majeure notice on some of its petrochemical supplies, FPCC spokesperson said on Tuesday.
The refiner's No.2 and No.3 crackers are still operating at around 70%, and the company will consider shutting one cracker if naphtha stock is insufficient.
JAPAN
Japanese chemical company Mitsui Chemicals has started to cut ethylene production from this week in Osaka and Chiba due to a drop in naphtha supplies, it said on Tuesday.
Mitsubishi Chemical on Monday started to cut ethylene production at its plant in Ibaraki.
Sumitomo Chemical Asia said it issued a force majeure notice this week for methyl methacrylate production after its feedstock supplier, Singapore petrochemical firm PCS, declared force majeure on shipments.
BAHRAIN
Bapco Energies declared force majeure on its group operations on Monday, following a recent attack on its refinery complex, the company said.
THAILAND
Thai petrochemicals firm Rayong Olefins, a unit of Siam Cement Group, declared force majeure due to the Middle East conflict, according to a copy of a letter seen by Reuters on Friday.
CHINA
China's Wanhua Chemical has declared force majeure to its Middle East customers, a company representative said on Monday.
Its two crackers, with a total ethylene production capacity of 2.2 million metric tons per year, are still running at high rates for now, according to two sources familiar with the matter. The company declined to comment whether production at the two crackers was cut.
Shell's south China petrochemical joint venture with China's CNOOC plans to shut a steam cracker soon and told domestic customers it is unable to supply some products, two sources told Reuters on Friday.
CNOOC and Shell Petrochemicals Co Ltd, or CSPC, plans to close a 1.2-million-ton-per-year (tpy) cracker in Huizhou, one of its two crackers with a total capacity of 2.2 million tpy, due to disruptions in feedstock supplies, the sources said.
Zhejiang Petrochemical Corp, a major Chinese refiner backed by Saudi Aramco, shut a 200,000-barrel-per-day unit, bringing forward maintenance in response to the Middle East conflict's impact on crude supply.
Another Chinese refiner backed by Aramco, Fujian Refining and Petrochemical Co, or FREP, shut its 80,000 bpd crude unit - its smallest - for an unspecified amount of time, two industry sources said.
China has also urged refiners to suspend signing new contracts to export fuel, and to try to cancel shipments already committed, sources said.
INDIA
India's Mangalore Refinery and Petrochemicals has shut a crude unit and some secondary units at its 300,000-bpd refinery due to oil shortage, sources said.
SOUTH KOREA
South Korean petrochemical company Yeochun NCC has cut its output and declared force majeure on its supply as it is unable to receive naphtha feedstock due to the Strait of Hormuz blockade, according to a source and a company letter reviewed by Reuters.
SINGAPORE
Singapore petrochemical firm PCS declared force majeure on shipments as the Middle East war disrupted maritime transportation and supply chains, according to a letter reviewed by Reuters and three people with knowledge of the matter.
Meanwhile, Singapore refiner and petrochemical major Aster Chemicals and Energy declared force majeure regarding supplies, a company spokesperson said on Friday.
Products covered by the force majeure include ethylene and propylene. Aster's steam cracker was running at around 50% on Friday, having restarted at the end of February, sources said.
Like this news? Make BIC Magazine a Google preferred news source.
INDONESIA
Indonesian petrochemical producer Chandra Asri has declared force majeure on all contracts as the Middle East conflict disrupted its raw material supply, it said in a statement.
VIETNAM
Vietnam's Binh Son Refining and Petrochemical asked the government to prioritize supplying domestically produced crude oil to its Dung Quat Refinery while limiting crude exports until at least the end of the third quarter this year to ensure national security, it said in a statement.
