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.
Poland's Azoty ramps up PDH/PP operations at Police
Poland's Azoty ramps up PDH/PP operations at Police
Warsaw, 8 November (Argus) — Polish chemical conglomerate Grupa Azoty said it is making progress in ramping up production at its new 437,000 t/yr propane dehydrogenation (PDH) and 429,000 t/yr polypropylene (PP) complex in Police, although it needs time to stabilise output and ascertain the unit's economic feasibility. Azoty said both units are operating even though formal commissioning of the entire project has not yet been yet completed. It is in negotiations with the contractor to undertake final improvements and overcome some defects, it said. Azoty expects to agree with the contractor on final terms of commissioning by the end of this year. Since the start of its operations, the PP plant has produced more than 200,000t and sales of PP reached 60,000t in the third quarter, Azoty said. Azoty sees healthy demand for its PP products from European buyers that want to diversify their supply portfolio to reduce risk in delays to imports from Asia-Pacific. "We see end users want have at least 30pc of their (PP) supplies to come from local European supplies," said plant manager Andrzej Dawidowski. He said the company sells PP through its own distribution as well as through traders that market in Europe and elsewhere. Azoty expects to make adjustments to this model as soon as it stabilises output, which would enable buyers to determine their demand for Azoty's product. Azoty said the Police plant is yet to generate positive earnings, and it requires stable supplies of feedstock propane. It said it is working with suppliers to secure financing to ensure steady propane supplies. Azoty also said the letter of intent with Polish integrated Orlen, about a possible sale of a stake in the PDH/PP project was extended until end of 2024, giving them more time to discuss the possibility of co-operation. By Tomasz Stepien Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Stellantis cuts 2024 US forecast
Stellantis cuts 2024 US forecast
Houston, 2 October (Argus) — Global automaker Stellantis has cut its 2024 guidance for its US operations. The company plans to accelerate its inventory drawdown strategy, aiming to reduce dealer inventory to 330,000 units by the end of 2024, from a previous goal of the first quarter of 2025. So far in the second half of 2024, Stellantis has reduced its US inventories by 40,000 vehicles, Ed Ditmire, head of investor relations, said on 30 September. To achieve this, Stellantis is reducing North American shipments by more than 200,000 vehicles in the second half of 2024, up from a previous goal of a 100,000-vehicle cut. Stellanties released the new guidance after it made changes to its production schedules, Ditmire said. Ditmire added that Chinese competition in Europe is challenging Stellantis' operations, and he estimated that in 2024 over 10pc of electric vehicle (EV) volumes and over 20pc of total vehicle sales in Europe will be from Chinese car companies. By Rye Druzchetta Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
US August ethylene contract settles higher
US August ethylene contract settles higher
Houston, 4 September (Argus) — The US August ethylene contract price settled at 33¢/lb, the highest recorded settlement since November 2022. The contract price rose by 0.75¢/lb from the prior month, or 2.33pc, which marks a fifth consecutive monthly increase. An uptick in the contract price was supported by higher US spot ethylene prices. Maintenance at Enterprise Products Partners' (EPC) cavern in Mont Belvieu, Texas, coupled with lower inventories in the second quarter, placed upward pressure on spot prices this summer. US spot EPC ethylene averaged higher month-over-month. The August spot average for front-month ethylene increased to 30¢/lb from 26.59¢/lb in July. On 3 September, Argus assessed US spot EPC ethylene at 30.31¢/lb. The US ethylene contract price is a 50/50 formula accounting for ethylene spot prices and ethane feedstock costs. The average of spot ethane prices was lower in August at 13.95¢/USG, down from 15.43¢/USG in July. Prompt month EPC ethane traded higher in September alongside natural gas. By Joshua Himelfarb Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Canadian rail labor talks continue as deadline nears
Canadian rail labor talks continue as deadline nears
Cheyenne, 21 August (Argus) — Canadian railroads and a major labor union are still in discussions in the final hours before workers could go on strike. Contract negotiations between Canadian Pacific Kansas City (CPKC), Canadian National (CN) and Teamsters Canada Rail Conference (TCRC) continued today, CPKC said. If there is no agreement tonight, the union at 12:01am ET Thursday could begin a strike against CPKC and each railroad could begin a lockout of workers. The Teamsters did not issue a required strike notice to CN, but a lockout would still shut its network down. Railroad customers and Canadian authorities are increasingly frustrated by the lack of agreement on new labor contracts. Teamsters members have been working under the terms of contracts that expired in December 2023. Canadian prime minister Justin Trudeau today urged the railroads and union to resolve the situation and avert a strike. "It is in the best interest of both sides to continue doing the hard work at the table to find a negotiated resolution," Trudeau said. "Millions of Canadians, of workers, of farmers, of businesses, right across the country are counting on both sides to do the work and get to a resolution." Canadian minister of labour Steven MacKinnon yesterday said he met with Ontario's labour minister and would be meeting with each railroad and Teamsters officials in Montreal and Calgary "to deliver our shared message: Get a deal at the table. Workers, farmers, businesses and all Canadians are counting on it." Union members have voted twice to authorize a strike, and each railroad has indicated it will lock out union members at the same time. The latest indication is the strike could happen as early as Thursday 22 August. "CPKC remains focused on and committed to arriving at a negotiated outcome that is in the best interests of all our railroaders and their families," CPKC said today. "We are firmly committed to staying at the bargaining table to reach renewed agreements." The Teamsters and CN did not respond to requests for comment. Last week, the railroads initiated embargoes on shipments of toxic inhalation hazards (TIH) and poisonous inhalation hazards (PIH) materials. Those products include chlorine, ammonia, ethylene and phosgene, as well as rail security-sensitive materials such as explosives. Each carrier has now stopped loading trains in Canada and are focused on delivering existing shipments. Railroads also have stopped shipping trains across the US and Canada border, suspending the movement of multiple products. US rail regulators are actively monitoring the situation, concerned about how a rail labor strike in Canada would affect the US rail network and supply chain. The US Surface Transportation Board said Wednesday it is monitoring the implementation and effects of those embargoes on the network. A number of US railroads last week either implemented their own embargoes or said they will comply with the Canadian embargoes. Western US coal exports are not expected to have much of a disruption if there is a strike since US carrier BNSF has rail lines going directly to Westshore Terminals near Vancouver. But BNSF will not be able to interchange railcars with CN and CPKC in Canada. Crude markets are also not expected to see significant disruption from a strike in the short term because of pending maintenance at upstream oil sands facilities and spare pipeline capacity. Prices for Canadian propane and butane — which rely heavily on rail to move product from an oversupplied market to the US — fell Wednesday ahead of the strike . By Courtney Schlisserman and Abby Caplan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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