No Relief in Upward Inching Mixed Xylene and Nitro Toluene Prices Despite Restricted Trading in COVID Fear

The Mixed Xylene and Nitro Toluene market in the USA kicked off with an increase of around 7% in the prices right in the first week of the year despite limited spot trading on the resurgence of COVID19 cases. The observed trend contradicted the usual trait of bearishness which typically follows on availability of inventories in the market. The surge in prices has raised uncertainty among the market participants who are alleging ongoing tumult in OPEC+ members Libya and Kazakhstan as the major reason behind it and closely eyeing the upstream crude oil supply concerns from these countries.

The price trends of crude oil-derived Mixed Xylene and Nitro Toluene are directly dependent on the crude oil market in the USA. The supply outages in Libya due to the three-week extended blockade at the country’s four major oil fields coupled with continuously growing protests in Kazakhstan’s oil-rich regions over the removal of capping on the LPG prices by the government have raised the international crude oil prices. The state of upheaval in Libya got further exacerbated with the recent damage to its oil pipeline causing the country to bear a loss of 780,000 barrels per day of oil output. On the other hand, the production in Kazakhstan oil fields, whose daily oil output equals nearly 2% of the total oil consumption across the world, has also been curtailed amid unstable conditions. Falling prey to the lowering crude oil supplies, the USA benchmark West Texas Intermediate (WTI) crude oil settled at USD 78.23 per barrel on January 11.

As per ChemAnalyst, the prices for Mixed Xylene and Nitro Toluene are expected to remain volatile owing to the continuous fluctuation in the crude oil prices. Although the restart of operations in the oil fields of Libya has elevated the oil output to some extent causing its prices to retract from the skyrocketing values of USD 82.17 per barrel (WTI) that reached on January 6, the still extending unrest in Kazakhstan has put the crude oil futures in jeopardy. Given that the demand for Mixed Xylene and Nitro Toluene usually stands high, the manufacturers may continue to offer high contract prices to the buyers in order to save considerate margins. The rise in prices is expected to stay for a brief period and the forthcoming month may bring relief in the market with an anticipated rise in crude oil output in the OPEC+ countries. Another important factor, which is the rise in Coronavirus cases, may overpower the low crude supply conditions and bring stagnancy in the price trends of its value chains in the coming weeks.