The Benzene prices in the US market continued to follow a southward price momentum as the demand for Benzene is limited with tight supply rates in the domestic market. Benzene is one of the major fluctuating commodities with a vast variety of end-use applications in the downstream sector, including pharmaceuticals, textiles, construction, styrene production, and more. Any fluctuations in the demand volume of Benzene from the above-mentioned end-use consumers showcase its proportional impact on the overall prices of Benzene in the domestic market. Additionally, upstream prices (crude oil and naphtha gas) in the domestic market play another significant role in the production cost of the Benzene. Towards the end of December, Benzene prices in the US market settled at USD 975 per MT, FOB Louisiana.

Crude oil futures experienced a double-digit drop in 2023 amid a turbulent year of global trade, fueled by geopolitical unrest and concerns over the production capacities of major oil-producing nations. Recent attacks by Yemen's Houthi militant group on ships navigating the Red Sea route prompted leading companies to redirect their shipments. While certain firms are gearing up to resume passage through the Suez Canal, some tankers carrying crude oil and Benzene are choosing the longer journey around Africa to steer clear of potential conflicts in the area. The final day of 2023 witnessed a surge in Middle East geopolitical tensions, with Israel intensifying its operations in southern Gaza, adding upward pressure on oil prices.

In December, the US manufacturing sector sustained its contraction, albeit at a somewhat reduced pace compared to November, according to the given data. The report highlighted that companies are adjusting their production levels in response to ongoing softness in orders not only from the domestic market but also from the overseas market.

Despite the manufacturing downturn, the overall economy maintained its growth momentum last year, achieving an annual expansion, and consumer spending played a key role in driving this expansion. The Federal Reserve, signaling a response to slowed inflation, indicated last month its likelihood of implementing a 75-basis-point rate cut in 2024.

Uncertain economic indicators raised concerns in the market regarding potential future energy demand, particularly from major importers. Despite the announcement of production cuts extending into the New Year, crude oil witnessed a continued decline in prices. Additionally, advanced economies grapple with the challenge of elevated interest rates, a situation not experienced in decades, and the lingering impacts of these conditions may still be unfolding in various instances. As per ChemAnalyst, the Benzene prices in the US market are anticipated to move forward steadily as the prices may vary between the inclined production cost amidst the continuous incline in crude oil prices and the moderate demand strength from Benzene end-use manufacturing units.