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Originally aired: December 9, 2015

Toluene and Xylenes Outlook for 2016:  Will octane shortages in the US refining system continue affecting petrochemical production margins?

After reaching unprecedented levels above spot pricing during the spring and summer of 2015, toluene and xylenes blend values returned to normal levels during the fourth quarter. The unexpected increase in US octane demand took the industry by surprise as lower gasoline prices pushed US consumers to demand more high octane gasoline. In addition, greater availability of suboctane components at low prices in US gasoline increased the demand for high octane blending components such as toluene and mixed xylenes.

High toluene and mixed xylenes blend values reduced the availability of spot cargos as these high octane streams were left in gasoline. Toluene conversion units that produce incremental mixed xylenes and benzene supplies in the US market saw unfavorable margins that led to significant reduction in operating rates throughout the year. In addition, non-integrated paraxylene production was also reduced as higher feedstock mixed xylenes costs squeezed margins as well in the presence of competitive imports from other regions.

Will these market conditions repeat themselves in 2016? Listen to this webinar as Paco Rangel, VP of Aromatics for this webinar discusses:

  • Potential changes in refinery and reformer rates as a result of ongoing octane shortages
  • Measures taken by market participants to be better prepared for a similar market in 2016
  • New aromatics trade flows that result from future market conditions
  • The impact of new downstream capacity in the paraxylene market
2016 Petrochemical Markets Outlook Webinar Series