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Global oil and petchem companies deliver record high Q2 results

by Başak Ceylan - bceylan@chemorbis.com
  • 12/08/2021 (03:07)
Global oil and petrochemical companies started announcing their financial results for the second quarter of 2021. The results reflected the continued recovery of the worldwide economy and demand from the COVID-19 pandemic, driven by reopenings and stimulus measures.

Saudi Aramco’s net income was $25.5 billion in the second quarter of 2021, indicating a 288% increase from the same quarter of last year. The company’s net income for the first half of the year was $47.2 billion, representing a 103% increase over the same period in 2020.

The increase in both periods was primarily driven by higher crude oil prices and improved downstream margins. The second quarter results also reflected a recovery in global demand, driven by easing of COVID-19 restrictions, vaccination efforts, stimulus measures and accelerating activity in key markets.

LyondellBasell reported record quarterly earnings driven by strong demand and tight market conditions. The company’s net income for the second quarter of 2021 was $2.1 billion while EBITDA was $3 billion.

Compared with the second quarter of 2020, the company’s olefins results increased by $865 million driven by higher margins and volumes. Margins increased primarily due to higher ethylene and propylene pricing outpacing increases in feedstock costs. Olefins results also increased by around $310 million compared to the first quarter due to higher margins and volumes driven by first quarter weather events.

Westlake Chemicals also reported record quarterly net sales of $2.9 billion and record quarterly net income of $522 million. EBITDA for the second quarter increased by $696 million compared to the second quarter of 2020, resulting in record quarterly EBITDA of $932 million.

The increases in net income and income from operations were primarily driven by higher sales prices and higher margins for all major products including PVC resin, polyethylene, caustic soda and building and construction materials as well as higher sales volumes for PVC resin. Higher sales volumes were largely due to operations rebounding following the impacts of the Winter Storm Uri in the first quarter.

Dow’s net income for the second quarter of 2021 was $1.9 billion, up significantly from the $217 million loss incurred during the same period in 2020. Net sales were up 66% versus the year-ago period and 17% sequentially at $13.9 billion, with gains in all operating segments, businesses and regions. Operating EBIT was also up by $2.8 billion from the year-ago period. Margin expansion and improved equity earnings due to tight supply and increased demand drove the gains.

Packaging and specialty plastics segment’s net sales were up 78% versus the year-ago period at $7.1 billion. Local prices increased 70% due to strong supply and demand fundamentals, with gains in both businesses and across all regions.

French energy major TotalEnergies, formerly called Total SA, reported $3.5 billion of adjusted net income, a 15% increase compared to the first quarter 2021. The company’s production increased slightly compared to a year ago thanks to the restart of the Feyzin refinery, in France, after a major shutdown in 2020. TotalEnergies’ polymer production also increased slightly in the second quarter of 2021 compared to a year ago, despite the shutdown of the Feluy plant in Belgium in the second quarter of 2021.

Ineos’ revenue increased by approximately 93.7% to €4.77 billion in the second quarter of 2021 as compared to the same period in 2020. The increase in revenues was driven primarily by higher prices and increased volumes. The increase in selling prices followed the increase in crude oil prices and the overall sales volumes were approximately 13% higher as compared to the same period in 2020, which was impacted by the effects of the pandemic on the global economy.

The polymers business in Europe experienced price increases in the quarter as compared to the same period in 2020, due to strong seasonal demand and an improved automotive market. However, sales volumes were lower as compared to the same period in 2020, primarily due to a planned turnaround at the Lillo, Belgium site.

The strong performance of the company’s polymers business in the US was also driven by higher prices, which were driven higher by a tight market coupled with high demand for both PP and PE.

Eni’s adjusted net profit was back to pre-COVID levels during the second quarter of 2021. Accordingly, the company reported €929 million of net profit, indicating a €1.6 billion increase compared to the second quarter of 2020. The increase was largely due to a better operating performance.

The company’s petrochemical product margins improved significantly, thanks to a macroeconomic recovery, which mitigated the competitive pressure, and unexpected factors stemming from supply shortages. A recovery in demand and tightness in availability resulted in sharp increases in Eni’s PE segment. The company’s styrenics segment also reported improved margins due to higher demand.
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