HOUSTON, Feb. 19, 2015 /PRNewswire/ -- Prices in the $3-trillion-plus global petrochemicals market slid 14% month over month in January, continuing a six-month slide triggered by falling crude oil and naphtha prices. Petrochemical prices, expressed as a monthly average, fell $133 per metric ton (/mt) from December to $850/mt in January, according to the just-released monthly Platts Global Petrochemical Index (PGPI).

This is the lowest level since June 2009, when global markets were recovering from the 2008 collapse of Lehman Brothers. During the past 12 months, petrochemical prices have fallen 40%.

The PGPI is a benchmark basket of seven widely used petrochemicals and is published by Platts, a leading global energy, petrochemicals and metals information provider and a top source of benchmark price references.

"Crude prices fell nearly 25% and naphtha prices were down 16% month over month in January," said Jim Foster, Platts director of petrochemical analysis. "With feedstock prices falling like that, there's really no other direction for petrochemicals to go than down. There have been signs of price increases since the end of January. The question being asked by the industry now, though, is if this current rally is sustainable - or just a short-term correction."

PLATTS GLOBAL PETROCHEMICAL INDEX IN DOLLARS PER METRIC TON
The daily price reflected as a monthly average

        Jan
        2015            Monthly %       Annual %   Jan 2014          Dec 2014        Nov 2014          Oct 2014          Sep 2014
                  Change          Change
    ---           ------          ------

             $850            -14%            -40%           $1,424            $984            $1,205            $1,324            $1,384
             ----             ---              ---            ------            ----            ------            ------            ------

To view the Platts PGPI price chart, visit this link: http://www.platts.com/IM.Platts.Content/InsightAnalysis/NewsFeature/2015/Petrochemicals/PGPI/images/pgpiaverage.jpg

Petrochemicals are used to make plastic, rubber, nylon and other consumer products and are utilized in manufacturing, construction, pharmaceuticals, aviation, electronics and nearly every commercial industry.

OLEFINS
Prices of olefins - a group of hydrocarbon compounds which are the building blocks to many petrochemical products used to produce everyday goods - posted double-digit declines in January. Ethylene prices tumbled 15% from December to $834/mt and propylene prices were down 10% to $786/mt.

Polyethylene and polypropylene, plastics manufactured from ethylene and propylene respectively, posted similar month-over-month drops in price. Global polyethylene fell to $1,230/mt, down 12%, while polypropylene fell 14% to $1,165/mt.

AROMATICS
Prices of aromatics - a group of scented hydrocarbons with benzene rings used to make a variety of petrochemicals - also saw a sharp price decline in January. Benzene posted the largest drop of any component in the PGPI, with prices shedding 18% from December to $604/mt in January. Toluene prices fell more than 17% to $554/mt, while paraxylene prices slid 12% to $729/mt.

Global equity markets were mixed in January. The London Stock Exchange Index (FTSE) posted a 1% gain and the NIKEEI 225 gained 3% during the month. However, the Dow Jones Industrial Average fell 4%.

To access a summary of the January performance of each of the seven key petrochemicals included in the PGPI, visit this link: http://www.platts.com/news-feature/2015/petrochemicals/pgpi/index.

The PGPI reflects a compilation of the daily price assessments of physical spot market ethylene, propylene, benzene, toluene, paraxylene, low-density polyethylene (LDPE) and polypropylene as published by Platts and is weighted by the three regions of Asia, Europe and the United States. Used as a price reference, a gauge of sector activity, and a measure of comparison for determining the profitability of selling a barrel of crude oil intact or refining it into products, the PGPI was first published by Platts in August 2007.

Published daily in a real-time news service Platts Petrochemical Alert and other Platts publications, the PGPI is anchored by Platts' robust and long-established price assessment methodology and the firm's 100-year history of energy price reporting.

Platts petrochemicals experts are available for media interviews. A sample list of experts may be found at the Platts Media Center. For more information on petrochemicals, visit the Platts website at www.platts.com.

About Platts: Founded in 1909, Platts is a leading global provider of energy, petrochemicals, metals and agriculture information and a premier source of benchmark prices for the physical and futures markets. Platts' news, pricing, analytics, commentary and conferences help customers make better-informed trading and business decisions and help the markets operate with greater transparency and efficiency. Customers in more than 150 countries benefit from Platts' coverage of the biofuels, carbon emissions, coal, electricity, oil, natural gas, metals, nuclear power, petrochemical, shipping and sugar markets. A division of McGraw Hill Financial (NYSE: MHFI), Platts is based in London with more than 1000 employees in more than 15 offices worldwide. Additional information is available at www.platts.com.

About McGraw Hill Financial: McGraw Hill Financial, a financial intelligence company, is a leader in credit ratings, benchmarks and analytics for the global capital and commodity markets. Iconic brands include: Standard & Poor's Ratings Services, S&P Capital IQ, S&P Dow Jones Indices, Platts, CRISIL, J.D. Power and McGraw Hill Construction. The Company has approximately 18,000 employees in 30 countries. Additional information is available at www.mhfi.com.

SOURCE Platts

SOURCE: Platts