Saudi Arabia Continues to Witness Increase in Benzene Import Prices

Jeddah (Saudi Arabia): Benzene prices in the Gulf market continued to rise due to supply chain challenges and increased crude oil and naphtha prices. Saudi Arabia is expected to maintain its crude oil prices for Asian customers in April, following a slight increase in Middle East benchmark prices. Despite expectations of OPEC+ extending production cuts, South Korea and Japan maintain strong crude supply security. Benzene prices in the Saudi Arabian market increased in late February due to tight supply and rising demand from petrochemical producers. Concerns about excess capacity in the US and China may further squeeze margins in the industry. Styrene, phenol, acetone, and other aromatics also continued to support Benzene price dynamics as demand outlooks increased from automotive, rubber, and other Benzene derivatives sectors. The Benzene price in the domestic market was observed at USD 1020 per MT, CFR Al-Jubail, with a 2.5% increase in the week ending March 1st, 2024.

Recent disruptions in the Red Sea are prompting companies to reassess their Benzene supply chain strategies, with higher insurance rates, uncertainties for cargo vessels, and reduced tanker traffic leading to noticeable delays and increased costs. The introduction of new container ships could alleviate some of these challenges, highlighting the importance of resilience in global Benzene supply chains.

The current events in the Middle East and their impacts on energy markets highlight the intricate mix of geopolitical, economic, and environmental elements. These challenges are testing the strength and flexibility of worldwide supply chains and energy plans, providing crucial lessons in handling unpredictability in our interconnected global economy.

Middle Eastern producers might need to safeguard their crucial market share in the Far East, especially with India and China showing strong preferences for Russian crude and East Asian traders boosting their purchases of US crude. This information comes from a feedstock manager at Hanwha TotalEnergies and a market strategist at a Japanese integrated trading company.

Overall, the Benzene market is facing significant shifts and challenges, but also opportunities for innovation and adaptation. Companies that can navigate these changes effectively will be well-positioned for success in the future. According to ChemAnalyst, Benzene prices are expected to remain stable and continue to rise due to increased demand from the international market and stable production costs attributed to naphtha prices. The continuous rise in the automotive industries in the global market have risen the demand for styrene consequently raising the demand for Benzene in the domestic and international markets.