Islamabad October 11, 2021: Makhdoom Khusro Bakhtyar, Federal Minister for Industries & Production, met with the senior leadership of Petrochemical industry to discuss a possible Petrochemical Policy framework.
The industry has shown lot of interest towards further development in this sector thereby contributing significantly to national exchequer, help resolve balance of payment and GDP growth.
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The petrochemical industry delegation was led by Ghias Khan, CEO Engro Corp, and senior leadership from Lotte, Tufail Chemicals, Gatron and ICI. Under this policy framework, project announcement of over US$3B within next 18-24 months (Engro US$:1.5-1.8B) is foreseen.
The investments in the proposed petrochemical policy will increase the Investment to GDP ratio by 1%.
Lotchem management briefs that the domestic polymer market is most likely to operate consistently backed by stable demand, improving economic activity as well as pro-investment and pro-business policies presented in Finance Act 2021.
In the second half of 2021, Crude (WTI) prices are expected to ease from current high levels as additional barrels are expected to enter the market while OPEC+ plans to gradually increase production. Moreover, the successful US-Iran negotiations shall further supplement supply and help ease prices. However, this downward price movement may inverse should the above factors fail to materialize.
Going forward, PX market is expected to lengthen as a new capacity of 2.2 million tonnes in China is expected to start up by the end of July. With excess supply available in the region and the pervasive spread of virus
variants affecting demand, the upstream Crude market will play a crucial role in influencing the price trend.
The PTA market is anticipated to follow a cautious approach as downstream demand struggles to return to the pre-pandemic levels. Additionally, a new capacity start-up in China amid limited planned shutdowns in the region may add pressure to the fragile industry margins.