Room for petrochemical prices to rise till 2017: SABIC

22 Jul '14

1 min read

The US will be able to produce shale gas in large quantities in 2018 and until then there is room for increase in prices of petrochemical products, said Mohamed al-Mady, chief executive of Saudi Basic Industries Corp (SABIC), while addressing a press conference in Riyadh.

The press conference was called to announce the second-quarter results of SABIC, in which the Saudi Arabian Government has a 70 percent state. The company is one of the largest petrochemical groups in the world.

During the April-June 2014 quarter, SABIC’s net profit increased by 6.95 percent year-on-year to 6.46 billion riyals (US$ 1.72 billion) due to higher production and sales volumes, sales prices for certain products, income from associated companies and other income as well as lower financial charges.

According to Mr. al-Mady, the business outlook for 2014 would remain similar to last year and petrochemical prices may remain stable.

However, the global outlook for the next three years is positive for petrochemical demand, and there is room for prices to increase. This is because, the production of shale gas, which is a prospective feedstock for petrochemicals, is not likely to go up in the US before 2018, Mr. al-Mady added.

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