Asia’s petrochemicals demand is associated with macro-economic growth and hence is being impacted by the economic uncertainty caused by COVID-19.
Verdict has conducted a poll to assess the factors that have impacted the petrochemical industry the most in Asia.
Analysis of the poll results shows that fall in petrochemicals demand has the most impact on the industry, as opined by a majority of 38% of the respondents.
Slower growth among the Asian economies impacted the petrochemicals demand the most, according to 27% of the respondents, while project delays and cancellations were the most impactful on the demand according to 19% of the respondents.
Furthermore, 16% of the respondents voted spending cuts for 2020 to have most impacted the petrochemical industry.
The analysis is based on 221 responses received from the readers of Offshore Technology, a Verdict network site, between 21 August 2020 and 30 March 2021.
COVID-19 impact on petrochemicals industry in Asia
The lockdowns imposed during COVID-19 had an unprecedented impact on the global petrochemical industry. The key petrochemical markets in Asia, however, reached record levels driven by strong crude gains after disruptions in the US output due to winter storm, and high activity in China.
The demand for polypropylene that accounts for approximately one-third of all petrochemical products utilised in cars, surged in China by 15% during the COVID-19 pandemic. The pandemic weakened the polymer demand in Asia from key end-use sectors such as construction and automotive, although the same was partially offset by the sustained demand from the packaging and healthcare sectors.
The demand for petrochemicals is expected to rebound in 2021 as economies start to reopen. Ethane, LPG, and naphtha are together forecast to account for 70% of the growth in oil product demand through 2026.