Hamburg, USA: The US and German Isobutylene markets remained on a bearish trajectory in September 2024, largely due to reduced production costs driven by falling crude oil prices. Additionally, ample inventory levels of isobutylene further supported the downward trend in the market.

In September 2024, despite a notable rise in the downstream Butyl Rubber market in Germany, the Isobutylene market remained under bearish pressure, primarily due to a weakening economy that eroded consumer confidence. This downturn overshadowed the gains in the automotive sector, where, according to the German Federal Motor Vehicle Authority (KBA), new passenger car registrations witnessed a monthly increase but were still lower on a year-over-year basis. These factors fueled bullish sentiment for Butyl Rubber, yet the Isobutylene market struggled to gain momentum. The accumulated inventories of Isobutylene and stiff competition from global suppliers, particularly aggressive pricing from Chinese manufacturers following supportive policy measures, suppressed new orders for Isobutylene. This surplus allowed manufacturers to delay replenishing stocks of Isobutylene, leading to a price decline of 1.23%, settling at USD 1200/MT (FD-Hamburg) in September. Additionally, uncertainty caused by strikes at German ports further weakened market confidence, prompting buyers to adopt a cautious stance, and exacerbating the sluggish demand for Isobutylene.

At the same time, the U.S. Isobutylene market experienced a continued downward trend, driven by the mixed performance of key downstream sectors, particularly fuel additives and butyl rubber. While the butyl rubber market experienced a rise, which typically would have bolstered demand for Isobutylene and lifted prices, this was offset by a downturn in the fuel additive sector. The performance of the fuel additive market was negatively impacted by the decreasing production costs of methyl tert-butyl ether (MTBE), which in turn reduced the demand for Isobutylene. This divergence between the rising demand for butyl rubber and the weakening fuel additive sector kept the Isobutylene market under bearish pressure. Additionally, the narrowing spread between Isobutylene and crude oil prices reflected ongoing bearish sentiment for the commodity, as lower crude prices reduced production costs, further contributing to the declining trend in the U.S. Isobutylene market. This combination of mixed downstream performance and broader economic factors led to subdued market activity for Isobutylene in September 2024. Furthermore, the U.S. Federal Reserve cut interest rates by 50 basis points, marking its first move toward easing monetary policy in four years as part of efforts to support economic growth and stabilize a slowing labor market.

According to ChemAnalyst, the Isobutylene market in the US and European nations is expected to experience an upward trend in the coming weeks, driven by an anticipated increase in demand for Isobutylene from the downstream Butyl Rubber and Fuel Additive sectors.