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It's 2012---Where is your resin coming from?

Smart makers and users of packaging are already closely monitoring the performance and cost of Middle East polymers and packaging products.

Pw 6491 Bohrer

Those polymers and products are an answer emerging as the world goes through a major dislocation in petrochemical costs, with cascading effects throughout the global economy. One of the major effects is the accelerating shift of financial power to the owners of scarce inputs.

It may be difficult to remember that as 2003 closed, crude oil prices were below $30 a barrel. The price spikes in the wake of the 2005 hurricanes took crude to $60. Yet, we were assured this was temporary.
However, persistent refinery problems in the U.S. and elsewhere—coupled with soaring Asian demand, speculation in commodity markets, and continued instability in several important producing countrie—have pushed oil to levels few could have predicted.

With extraction costs largely unchanged, companies and countries that control production have huge cash flows. Even countries such as Venezuela and Iran, where mismanagement has resulted in deteriorating assets and falling production, are ‘ahead’ (at least for now) because of higher prices.

Leveraging huge cash flows

The more sophisticated countries and companies receiving these unprecedented sums are implementing forward integration strategies. The goal is to capture even more value from the oil and gas resources they control.

Their logic is unassailable—if you own the raw materials, there is more money to be made by selling converted products than from just filling tankers with crude. And with almost no liquefied natural gas (LNG) receiving infrastructure in place in the U.S., countries like Qatar with huge natural gas reserves can sell more easily transported gas-derived products today.

Break out of the ordinary: see what’s new in packaging & processing!
At PACK EXPO Las Vegas, you’ll see machinery in action and new tech from 2,300 suppliers, collaborate with experts and explore transformative solutions. Join us this September to experience a breakthrough in packaging and processing.
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Break out of the ordinary: see what’s new in packaging & processing!
List: Digitalization Companies From PACK EXPO
Looking for CPG-focused digital transformation solutions? Download our editor-curated list from PACK EXPO featuring top companies offering warehouse management, ERP, digital twin, and MES software with supply chain visibility and analytics capabilities—all tailored specifically for CPG operations.
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List: Digitalization Companies From PACK EXPO