Strategic Chemical Projects in the Middle East Amid Global Oversupply

Two liquids-to-chemicals project announcements by Saudi Aramco highlight a new source of rapid capacity growth which will add to global overcapacity.

-          Middle East oil and gas companies want to push liquids-to-chemicals as demand for transport fuels declines

-          Aramco aims to convert around 4 million bbl/day of crude oil into chemicals by 2030 versus about 1 million barrels/day currently

-          Demand growth will not be sufficient to meet rising supply 

-          More closures will be needed to balance the market