Saudi Arabia says Gulf must rationalise to face stronger competition from the US and Asia
The shale-gas-backed resurgence in the US petrochemicals industry should be taken as a wake-up call to producers in the GCC to rationalise and improve efficiency, says Saudi Arabias deputy oil minister.
Deputy Minister of Petroleum & Minerals Prince Abdulaziz bin Salman al-Saud warned that Gulf petrochemicals producers will face an era of stronger competition after the regions rise as a major chemicals exporter.
In next decade will face stiffer competition from new players with more energy efficient plans, more availability of gas, greater access to technology and higher capacity to innovate, said Prince Abdulaziz, speaking at the Gulf Petrochemicals & Chemicals Association (GPCA) Forum in Dubai on 20 November.
The US rapid growth in shale gas has brought a sharp growth in the availability of ethane and propane leading to what some have described as renaissance of petrochemicals manufacturing, he said. Governments in Asia are also keen to develop their growth in petrochemicals to keep up with rising demand.
This environment of increased global competition should be a wake-up call for all the GCC petrochemicals industry to rationalise and improve efficiency, he added.
Prince Abdulaziz, along with petrochemicals business leaders at the GPCA Forum, used the platform to warn against the growing trend towards protectionism in the global industry.