US Benzene Prices Increase in Mid-January 2023 Amidst Its Upstream Costs

Texas- Benzene prices have witnessed sporadic behavior from the first week of January and continued to do the same. In mid-January 2023, the market prices of Benzene rebounded on the back of inclining upstream WTI crude oil prices. Accompanying these prices, the stabilizing industrial pace and the demand strength contributed to rallying the prices of Benzene in the US market. Earlier, towards the end of Q4 2022, market insiders had predicted to witness a drastic fall in the country's economic sector; however, the current scenario is different and economic stability is seen. The market prices made a better recovery, and an incline of approximately 7% was observed in the final prices of Benzene, and the quotations ranged between USD 1173 to 1243 per MT, FOB Louisiana in the US market.

Major facets impacting the final prices of Benzene were the enhanced demand from the domestic and international markets along with eased supply chain. Waiting times have decreased on both the East and West coasts of North America, and they have also decreased in Oakland, Seattle, Norfolk, Savannah, and Baltimore. Moreover, the labor shortage in the US has always been a major issue, and the government has taken significant steps to tackle the situation. According to the US official data, sufficient staff members relaxed the pressure on manufacturers to complete the backlogs, consequently increasing Benzene's final prices in the regional market with an improvised operational position. On the other hand, the labor shortage continues to affect Houston (one of the major ports of America), where waiting times can reach two days for US Flag vessels and eight days for all other vessels. Vancouver (a city in Washington), which has a six-day waiting period because of the harsh winter, is affected by Canadian ports. 

To reduce the cost of Benzene's pressures, the American bank urges buyers to save more money and spend less by raising interest rates. However, it runs the risk of starting a major downturn that impacts the final production capacity and prices of Benzene in the US. As per ChemAnalyst, the market prices of Benzene are anticipated to move at a stagnant pace in the US market on the back of a better downstream (styrene and maleic anhydride) demand outlook in the regional market.