Petrochemicals face continued pressure in Q1 amid high costs, oversupply

At the same time, weak demand recovery—especially in key end-use sectors like construction, automotive, and consumer goods—has exacerbated margin pressure. Falling oil prices have impacted integrated producers, particularly in the US and the Middle East, by compressing feedstock-related profits.
Meanwhile, European producers struggle with structurally higher energy and production costs, making their products less competitive globally. Even in regions that reported revenue growth, profitability has remained under pressure, highlighting the fragile state of the sector.
Europe: Strained by high production costs
European petrochemical producers continue to suffer from high energy and feedstock costs, significantly eroding their competitiveness in the global market.
Germany’s BASF reported a sharp drop in Q1 2025 net income to €808 million, down from €1.36 billion a year earlier, as weaker sales volumes and pricing pressure hit earnings. London-based Ineos reported a year-on-year EBITDA decline to €416 million in Q1 2025, as subdued European polymer markets offset stable olefins and firm butadiene performance. Spain’s Repsol reported a 48% decline in adjusted net profit for the first quarter of 2025, totaling €651 million, down from €1.25 billion a year earlier.
Shell’s chemicals and products division reported $449 million (€415 million) in adjusted earnings for Q1 2025—down sharply from $1.6 billion last year—driven by stronger refining margins despite a $137 million loss in chemicals. French TotalEnergies’ refining and chemicals segment saw a significant 69% decline in income compared to the same period last year and 5% decrease from the previous quarter at $301 million (€278 million), affected by subdued demand and growing competition from new refineries in Asia and Africa. Austrian OMV’s Chemicals segment earnings dipped 3% to €126 million in Q1 2025, mainly due to weaker contributions from Borealis in base chemicals and polyolefins.
While others still remained on the positive side, there are also companies moving to the negative territory. Italian Eni’s Chemicals segment, managed by its subsidiary Versalis, posted a pro-forma adjusted loss of €243 million in Q1 2025, up 45% year-on-year, due to ongoing weakness in Europe’s chemical sector and high production costs. Germany’s Covestro recorded a net loss of €160 million in Q1 2025, widening from a €35 million loss a year earlier, driven by restructuring charges and continued market pressure.
US: Oil price volatility hits chemical segments
In the US, falling oil prices have weighed heavily on the petrochemical earnings of integrated oil and gas companies, despite relatively stable demand. Among them, Chevron’s downstream earnings, including chemicals, dropped to $325 million from $783 million primarily due to lower margins on refined product sales, followed by ExxonMobil’s chemicals segment’s quarterly earnings, which fell to $273 million from $785 million a year ago, then LyondellBasell, which reported a net income of $177 million for the first quarter of 2025, down from $473 million in the same quarter last year.
This was followed by OxyChem, which posted a net income of $141 million in Q1 2025, and Olin, which reported first-quarter 2025 net income of $1.4 million, or $0.01/share, down sharply from $48.6 million a year earlier.
In contrast, Westlake posted a net loss of $40 million in Q1 2025, while Trinseo reported a Q1 2025 net loss of $79 million, and Dow reported a net loss of $290 million for the first quarter of 2025, the largest among the listed US companies.
Asia: Overcapacity and pricing pressure dominate
Asia’s performance remains mixed. While China and Southeast Asia saw some recovery in volumes, overcapacity and weak product prices continue to undermine profitability.
Sinopec reports decline, PetroChina sees improved results
Chinese Sinopec’s first-quarter profit declined 25% to RMB 13.98 billion ($1.91 billion) as lower revenues weighed on overall performance.
PetroChina’s Q1 profit rose 2.3% year-on-year to 46.81 billion yuan ($6.44 billion), supported by higher natural gas output despite weaker revenue and refining volumes.
LG Chem posts yearly drop, Lotte Chemical reports loss
LG Chem’s Q1 net profit fell 24% year-on-year to 260.4 billion won ($183 million). However, the company recovered from a net loss of 899.2 billion won ($632 million) in the previous quarter.
Lotte Chemical reported a net loss of 246.3 billion won ($173 million) for the first quarter of 2025, remaining in the red from a year earlier as challenging market conditions persisted.
Weakness in SEA continues, some growth reported
Philippines’ JG Summit Olefins Corporation (JGSOC) posted a 46% revenue drop to P7.6 billion ($132 million) in Q1 2025 due to an indefinite shutdown starting in January. Thailand’s Indorama reported a net loss of $39 million in the first quarter of 2025, compared to a net profit of $32 million in the same period last year.
Meanwhile, Malaysia’s Lotte Chemical Titan reported a reduced net loss of RM125.67 million ($29.6 million) for the first quarter of 2025, compared to RM178.03 million ($42 million) a year earlier. Thai SCG reported a consolidated profit of 1.1 billion baht ($33 million) for the first quarter of 2025, recovering from a loss of 512 million baht ($15 million) in the fourth quarter.
Middle East: Diverging results amid weak pricing
Middle Eastern producers reported mixed outcomes, with some showing gains due to higher sales volumes, while others posted losses tied to lower oil prices and elevated production costs.
Saudi Aramco reported a net income of $26 billion for the first quarter of 2025, down by 5% from $27.3 billion recorded in the same period last year, as global trade disruptions and economic uncertainty weighed on oil prices. Saudi chemicals giant SABIC reported a first-quarter net loss of 1.21 billion riyals ($323 million), sharply reversing from a profit of 250 million riyals ($66 million) last year, due to rising operating and feedstock costs.
Nonetheless, Petro Rabigh significantly reduced its net losses for the first quarter of 2025, reporting a 49.4% year-on-year decline to SAR 691 million ($184 million), compared to SAR 1.36 billion ($362 million) in the same period last year. Abu Dhabi-based Borouge posted a 3% Q1 2025 net profit increase to $281 million, boosted by record March production and a 10% sales volume rise.
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