Crude Oil Prices Continue to Add Pressure on C9 Solvent Market
- 27-May-2022 3:19 PM
- Journalist: Jai Sen
Delhi NCR, India: As per the ChemAnalyst Database, the C9 Solvent price in India remained steady this week on the back of fluctuating upstream Crude value. The previous market sentiments persisted as the domestic traders were afraid of loss-making.
International Crude Oil prices reached record heights this year, striking a fourteen-year high of nearly 140 US Dollars per barrel during March as the Russia-Ukraine crisis worsened supply concerns. The prices have dropped, but they are still above USD 110, a level that's driving inflation and oppressing economic recovery in many parts of the world, particularly in India. Because India relies heavily on imports (approximately 85 percent), fluctuations in global crude prices have a significant impact on the economy.
There is speculation in the market that the Indian government is likely to propose a windfall tax on the earnings of oil and gas businesses, with Crude climbing over 50 percent in 2020. The additional revenue mobilization efforts could help compensate for revenue loss caused by recent excise duty cuts, higher fertilizer subsidies, and other factors.
The logistical issues and supply chain challenges faced by the domestic manufacturers are the reasons for C9 Solvent's uphill pricing in India. Suppliers concentrated on long-term volumes or self-consumption, with little to no supply for spot transactions. Due to low stock levels, sellers were resistant to selling. In contrast, other challenges, including inflationary pressure and cost pressure combined with speculations over trade activities which may hamper amid Russia-Ukraine geopolitical tensions, have kept the prices on a higher note. Meanwhile, demand from downstream paints and coatings manufacturing firms has been relatively on the higher side. At the same time, demand for end-use pharmaceuticals has also been robust over the last few weeks.
As per ChemAnalyst, "The price of C9 Solvent is expected to stay high as the market's supply, and demand fundamentals are likely to remain unfavorable. Also, no sign of decline can be expected in upstream Crude oil pricing with increasing uncertainties in the global market."