Octane blending
Overview
Demand for high octane components vary throughout the year depending on seasonality, premium gasoline market share, and refinery performance. Stricter gasoline standards also contribute to demand for high octane components.
Among the list of high-octane components are reformate, alkylate, MTBE, ETBE, toluene, xylenes, ethyl benzene, and others. Some of these components primarily see demand from the chemical market but could be diverted to the gasoline pool if there are returns in that segment.
Each blendstock has specific octane rating and rvp content that determines its value in the gasoline pool. Gasoline blenders will look at market prices for each of the octanes and see how it relates to the value in the gasoline pool. In the summer of 2023, high volumes of ethylbenzene were diverted to the gasoline instead of the production of styrene, as styrene prices fell below ethylbenzene blend value.
MTBE is a high-octane component for gasoline blending, but only used in some countries. MTBE demand has been led by growth in Asia, Middle East, and Latin Markets. Other regions have focused on increased biofuel usage which includes ethanol and ETBE.
Argus’ experts will help you determine what trends to track and how to stay competitive in today’s ever-changing global markets.
Latest octane blending news
Browse the latest market moving news on the global octane blending industry.
Dow delays Path2Zero ethylene project in Canada
Dow delays Path2Zero ethylene project in Canada
Houston, 24 April (Argus) — Dow is delaying construction in Canada of its Path2Zero project, designed to produce 1.9mn metric tonne (t)/yr of low-carbon ethylene, until "market conditions improve", the company said today. The company decided to delay work at its Path2Zero project site in Fort Saskatchewan, Alberta, in light of uncertainty around US tariffs and potential retaliatory tariffs by US trading partners, especially their impact on product demand, the company said Thursday on its first-quarter earnings call. Path2Zero, designed to produce ethylene and derivatives with net-zero carbon emissions, was announced in October 2021 and was originally planned for a first-phase start-up in 2027 and a second phase in 2029. The first phase was meant to coincide with an expected upturn in the business cycle. But tariffs have increased uncertainty to the point that Dow said it cannot be sure of a recovery in two years. Chief executive Jim Fitterling described the current market environment as "one of the most protracted down-cycles in decades", compounded by geopolitical and macroeconomic concerns that further weigh on demand. The Path2Zero project delay will save $600mn in 2025, accounting for 60pc of the company's plan to cut capital spending this year by $1bn from the company's original $3.5bn spending plan. The pause comes before a ramp up in construction labor and allows the company to see how tariffs effect global demand and supply chains. "We are at a point right now where we can make this decision to have minimal impact on the project," Fitterling said. "We've done a lot of groundwork, we're finishing our engineering work, and we've got our long lead time items ordered." Despite the delay, Dow remains committed to the project in the long-term. The project will one day capture upside in demand for targeted applications like pressure pipe, wiring cable and food packaging, the company said. When complete, the project is expected to generate approximately $1bn/yr in incremental earnings. Even with the delay, it is still likely to be the world's first integrated ethylene complex to achieve net-zero Scope 1 and 2 emissions. To restart the project, Dow said it would have to start seeing supply and demand balances tighten. The company said it would next revisit restarting the project at the end of 2025. Without a green light by year's end, Dow said it would review a project restart "on a regular basis". The project would triple the site's ethylene and polyethylene (PE) capacity. In total, the site would produce approximately 3.2mn t/yr of low-to-zero emissions PE and other ethylene derivatives. The first phase startup in 2027 was to have brought on 1.3mn t/yr of ethane-derived ethylene and PE, and the second phase in 2029 was to bring on an additional 600,000 t/yr of ethylene and PE. The site will also convert cracker off-gas into hydrogen to be reused as a clean fuel in the production process. The project is designed to capture CO2 emissions for storage by adjacent third-party infrastructure. By Michael Camarda Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
Dow studying German cracker and chlorine/vinyl closures
Dow studying German cracker and chlorine/vinyl closures
London, 24 April (Argus) — Dow has announced an expansion of its strategic review of European assets, which it said may result in the potential idling or shutdown of its cracker in Boehlen, Germany, chlor-allkali and vinyl assets in nearby Schkopau, also in Germany, and the shutdown of siloxanes production in Barry, UK. The company aims to complete the review, including the initial scope of its polyurethanes business by mid-year. The European actions are part of a package of measures aimed at delivering $6bn in cash support to help it manage the current downturn. Outside Europe, Dow said that it would also delay construction of its Path2Zero project in Fort Saskatchewan, Alberta, Canada until market conditions improve. The total includes $1bn in costs savings by 2026, $1bn in capital expenditure savings and proceeds from the sale of a stake in a newly-formed infrastructure-focused company resulting in the sale of a minority stake in select US Gulf Coast infrastructure assets. The measures were announced as Dow reported first quarter 2025 results with a net loss of $290mn, down by $444mn year on year, primarily driven by lower prices and higher energy and feedstock costs. Sales of $10.4bn were down by 3pc on the year but with a volume increase of 2pc. Dow chief executive Jim Fitterling said: "The significant impact of slower GDP growth and volatile market conditions on our industry underscores the importance of our proactive management and best-owner mindset. Today's announcements build on Dow's cost actions that are already underway, aiming to further strengthen our financial flexibility and support a balanced capital allocation approach." Dow's cracker in Boehlen has an annual ethylene nameplate capacity of 540,000 t/yr, with propylene capacity of 285,000 t/yr. The review comes in the same week that TotalEnergies announced a plan to close one of its Antwerp crackers by the end of 2027. LyondellBasell, which is also reviewing a number of European chemical assets, will announce its first quarter 2025 results tomorrow. At Schkopau, Dow operates a chlor-alkali unit with 250,000 t/yr chlorine capacity and 740,000 t/yr ethylene dichloride capacity. The site previously had around 330,000 t/yr of capacity for chloride monomer (VCM) production, with two lines operating at the site, but Dow closed the larger of the two lines to reduce capacity to roughly 110,000 t/yr of VCM earlier this year. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
TotalEnergies plans Antwerp cracker closure
TotalEnergies plans Antwerp cracker closure
London, 22 April (Argus) — TotalEnergies has announced plans to close one of the two crackers at its integrated refining and petrochemicals complex in Antwerp, Belgium by the end of 2027. The Antwerp complex is "facing considerable overcapacity in the petrochemicals market", the firm said. The company does not expect to close any downstream petrochemical units at Antwerp and stressed that the cracker is not integrated into its own downstream polymer production. Rather, its exposure to the merchant market has contributed to the closure, with the company highlighting the non-renewal of a major third-party ethylene contract by the end of 2027 as the main driver for the announcement. The unit marked for closure has a nameplate ethylene capacity of 570,000 t/yr and propylene capacity of 255,000 t/yr. It mainly runs on naphtha but has some flexibility to use propane and butane as feedstock. The planned closure will come shortly after the expected start-up of a new 1.45mn t/yr ethane cracker in Antwerp being built by UK-based Ineos. TotalEnergies said it will focus on its other Antwerp cracker, which has 600,000 t/yr of ethylene capacity and is fully integrated with similar-capacity polyethylene units at Antwerp and Feluy. While the closure will not impact TotalEnergies' internal ethylene balance, it will tighten internal propylene supply for the company's 930,000 t/yr polypropylene capacity at Feluy. The cracker closure is part of wider plans for the Antwerp complex announced today, which include wind power, electrification and battery storages and sustainable aviation fuel production. By Alex Sands Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
US ethane cracking margins at 10-month low
US ethane cracking margins at 10-month low
Houston, 20 March (Argus) — US ethane cracking margins have fallen to the lowest in 10 months on rising ethane cash costs and falling spot ethylene prices at Mont Belvieu, Texas, according to an Argus generic model. Ethane cracking margins on Wednesday fell to 10.5¢/lb, the lowest level since May 2024. Margins have steadily narrowed from a peak of 24.75¢/lb two months ago, when a freeze took several US Gulf coast crackers off line and spiked ethylene prices to 35.25¢/lb in a trade at the Enterprise Products Partners (EPC) system at Mont Belvieu. The decline in cash margins largely follows falling domestic ethylene spot prices as US crackers have incrementally restarted and ramped up production since mid-January. US spot EPC ethylene traded Wednesday at 24.75¢/lb, the first trade below 25¢/lb since late November. The more than 10¢/lb decline in ethylene spot prices does not fully account for eroding ethane cracking margins. Ethane costs have risen by more than a third through February and into March, hitting an 18-month high last week of 31.1875¢/USG. Higher ethane costs have largely followed higher natural gas prices at the benchmark Henry Hub, which hit a two-year high at $4.491/mmBtu on 10 March stemming from tightening US gas inventories. Natural gas prices serve as a price floor for ethane because it is separated from raw natural gas during processing. The 60pc drop in ethane cracking margins over the past two months is unlikely to affect ethane-based ethylene production, as margins of at least 4-5¢/lb are generally still profitable for cracker operators. US ethane cracking margins in 2024 averaged 14-15¢/lb, according to Argus data. Ethane structurally remains the most advantaged feedstock on the US Gulf coast and was last surpassed briefly by a competing feedstock more than 18 months ago. Propane cracking margins are currently negative and the butane cracking margin has ranged from 3.5-8¢/lb this month. By Michael Camarda Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.
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