Omicron continues to run its riot across various industries hampering their normal functions and countries are left stranded to speculate over controlling the spread of the variant. After recovering to certain extent, global economy is again in troubled waters. Investors were rattled leading to significant decline in crude oil and natural gas.

Several governments have imposed travelling restrictions from abroad while tightening the covid protocols domestically to curb the spread. Fertilizer market, worldwide, has lost its steam where at one time it looked farfetched, however in last week or so since the emergence of Omicron, key fertilizers have fallen back, and a dip has been measured in prices indicating a bearish beginning of 2022.

US PE market can also witness a decline in prices building on stagnation in demand growth in Q4, cautious approach of buyers in the short term and falling natural gas prices a key upstream for polyethylene. US PE market has been on a stronger side for a major part of the year gaining from production losses and remarkably high demand in previous quarters.

Crude Palm oil (CPO) prices have declined sharply, around halfway mark in November CPO were sky-high at MYR 4993 per MT and since then a substantial fall has been measured as CPO prices plunged to MYR 4650 per MT. In lieu of that, Oleochemical market has been going through winds of change. Spot market for all Oleochems has become dull as buyer interest waned since the onset of Omicron. Contract market has remained stable however Q1 2022 negotiations can provide some reprieve for the buyers after a strong 2021 where manufacturers and suppliers enjoyed the upper hand. Glycerine prices have stabilized in the early trading of December at USD 1450 per MT in FOB SE Asia while fatty acid C12 Lauric Acid has been stable since the last week at USD 2150-2250 per MT FOB SE Asia.

As per ChemAnalyst, “weakening crude and natural gas has a direct bearing on the petrochemical market and bearish buyer sentiment will further deteriorate the market dynamics. Economies are still assessing the impact of Omicron and market outlook is unlikely to change in the short term.”