Asia petrochemical shares tumble on concerns over Omicron variant | ICIS

SINGAPORE (ICIS)–Shares of petrochemical
companies in Asia tumbled on Monday, while
crude recouped some of the heavy losses in the
previous session, on concerns over the
emergence of a new and more transmissible
COVID-19 variant called Omicron.

Developments on the new coronavirus variant,
which could disrupt global economic recovery,
will be closely watched this week.

At 10:40 Singapore time (02:40 GMT), Asahi
Kasei was down 2.17% in Tokyo, SK Innovation
fell by more than 3% in Seoul and Formosa
Petrochemical Corp slipped by 0.52% in Taipei.

Japan’s benchmark Nikkei 225 Index was stable,
Hong Kong’s Hang Seng Index was 0.44% lower and
Singapore’s Straits Times Index index fell by

Company/Stock Exchange (as of
02:40 GMT)
% Change
Nikkei 225 (Japan) 0.00%
Asahi Kasei Corp -2.17%
ENEOS Holdings, Inc -1.35%
Mitsubishi Chemical Holdings Corp -1.21%
Mitsui Chemicals, Inc -1.11%
Hang Seng Index (Hong
China Petroleum & Chemical
Corporation (Sinopec)
PetroChina Company Limited 0.59%
KOSPI Composite Index (South
OCI Company Ltd 2.71%
SK Innovation Co., Ltd -3.11%
LG Chem, Ltd -0.83%
Lotte Chemical Corp -0.50%
Hanwha Corp -1.12%
TSEC weighted index
Formosa Petrochemical Corp -0.52%
Nan Ya Plastics Corp -0.95%
Formosa Chemicals & Fibre Corp 0.13%
STI Index (Singapore) -0.81%
Wilmar International Limited 0.00%
Olam International Limited 1.70%
FTSE Bursa Malaysia KLCI
SSE Composite Index (Shanghai,
Jakarta Composite Index
PT Chandra Asri Petrochemical Tbk 0.36%

Crude prices were recovering on Monday, with
Brent crude up by $3.58/bbl, or 4.9%, at
$76.30/bbl and US WTI rising $3.72/bbl or 5.5%
at $71.87/bbl.  

On 26 November, US WTI crude tumbled by $10.24
on Friday, or 13.1%, to close at $68.15/bbl,
declining more than 10.4% in the week, while
Brent crude shed $9.50 or 11.6% to $72.72/bbl,
representing a weekly decline of more than 8%.

This was the steepest fall in both WTI and
Brent prices since April 2020 and marked the
crude benchmarks’ fifth consecutive week of

In Asia, Japan is considering further border
controls to prevent the spread of Omicron, the
country’s Prime Minister Fumio Kishida was
quoted by local media as saying on Monday.

Singapore Prime Minister Lee Hsien Loong on
Sunday said that the country is tracking
developments surrounding the new coronavirus
variant “very closely”, adding that the country
could dial back its re-opening plans.

Concerns about the Omicron variant rattled
investors late on 26 November, sending equity
in the US and Europe, as well as oil
prices on a downward spiral.

“Omicron is said to be five times more
infectious than the Delta variant and confirmed
cases have been reported in the UK, Germany,
Italy, Netherlands, Australia, Hong Kong, just
within three days after it made headlines
globally,” Malaysia’s HongLeong Bank said in a
note on Monday.

According to the World Health Organization
(WHO), it was not yet clear whether Omicron,
first detected in southern Africa
region, is more transmissible compared with
other variants, including Delta.

“WHO is working with technical partners to
understand the potential impact of this variant
on our existing countermeasures, including
vaccines,” it said in a statement.

The WHO has named the strain as a “variant of

US equities slumped on 26 November, with the
Dow Jones Industrial Average ending 2.53% lower
– its worst performance so far this year.

Following the discovery of Omicron coronavirus
variant, the US announced that it will restrict
travel starting Monday from South Africa and
seven other southern African countries.

In Europe, both Germany and France’s
leading stock market indexes fell by more than
3% on Friday, and UK’s FTSE 100 index ended
3.7% lower.

Focus article by Nurluqman

Thumbnail photo: Singapore port – 10
November 2020 (By WALLACE


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