Soaring Crude Oil Prices put Inflationary Pressure on Downstream n-Butanol

The ongoing Russia-Ukraine war has been affecting global market sentiments, where soaring crude oil value has started bothering major economies like the USA, UK, Germany, India, etc. As per recent ChemAnalyst data, n-Butanol prices in the USA have started showing upward momentum on the back of high input cost, and traders are concerned about their profitability. In the meantime, manufacturers are also concerned with offtakes, as high product prices costs may lead the demand fundamentals towards depression in the domestic market.

Recent sanctions on Russia by some major economies like the USA, Germany, UK, Japan, South Korea, etc., have also left a major impact on their own economies. Meanwhile, as per the recent information, the USA has announced an import ban on energy feedstock, including Crude oil and natural gas from Russia, which has also injected a wave of uncertainties across the global market. However, the USA is not a prominent importer of crude and natural gas from Russia.

As per the ChemAnalyst data, a rise of around 2.4% has been observed in prices of n-Butanol across the US market since Russia commenced special military operations in Ukraine. This rise in pricing dynamics is expected to persist for a further period in the domestic market of the USA. Moreover, rising inflationary pressure has also started threatening the profit margin of manufacturers, as the global crude oil price is about to cross USD 130/b on a contract basis. Furthermore, demand fundamentals are also expected to rise in forthcoming months, seasonal offtakes are likely to get bullish in the domestic market. As per ChemAnalyst analysis, “ Demand fundamentals for Oxo Alcohols may rise during Q2 2022, bolstered by high demand from the construction sector, which might further affect overall pricing dynamics for n-Butanol in the forthcoming quarter.”