Listen to Victoria’s World Petrochemical Conference 2024 Reflections Here:

Curious about the major strategic issues facing all aspects of the petrochemical industry? Learn more about what leading global experts and industry executives are discussing in terms of critical issues impacting the chemical market from the 2024 World Petrochemical Conference (WPC) with host Victoria Meyer. With over 1500 attendees from 53 countries, representing 550 companies, conference topics ranged from decarbonization, to supply chain resilience, to the impact of geopolitical challenges on the shipping industry.

Victoria is joined by industry experts Tony Potter and Rahul Kapoor from S&P Global on this week’s episode of The Chemical Show to highlight the major takeaways from the WPC 2024. Through insightful discussions, Victoria and her guests explore the role of chemicals in the energy transition, regionalization of supply chains, and the progression towards sustainable technologies, offering valuable insights and engaging perspectives for professionals in the chemical and shipping industries. 

Join us this week as Victoria, Tony and Rahul discuss the following:

  • The role of chemicals in the energy transition and decarbonization
  • The need for alignment and collaboration in developing global standards around sustainability, ESG measurements, and other industry requirements
  • The chemical industry is a vital part of the energy transition 
  • Geopolitical challenges in the shipping industry
  • The challenges of decarbonization in supply chains


Killer Quote:The chemical industry’s outlook is bright. There is an upturn. There is a lot of positivity.” – Victoria Meyer 


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Decarbonization, Supply Chains, & Future Growth: Themes from WPC 2024

Victoria’s Key Takeaways

Hi, I’m recording today at the World Petrochemical Conference (WPC) 2024, which is sponsored by S&P Global. The theme of this year’s conference is positioning for the next upturn. It’s actually been a really interesting mix of conversations both on stage and off stage about what that actually looks like, because there is a number of key themes around this. One of which, and this is the overarching theme, is that yes, we’re in a bit of a downturn at the moment, right? There’s no doubt. Demand is flat, or appears to be relatively flat. We’re in oversupply.

Inflation has had an effect. What’s going on in China has had an effect. Interest rates have had an effect. Yet, the industry continues to be cyclical, and we are clearly poised for an upturn. Maybe not this year or next year, but certainly by the end of the decade, there is an expectation of significant growth and investment restarting globally.

So a couple of big themes that we talked about here at the conference that I think are just worth sharing. Number one is decarbonization. In fact, I spent a lot of time this week in conversations around decarbonization, hearing from people onstage, as well as off stage. What’s really interesting is the onstage carbon conversations for 80% of the time where basically that, decarbonization is here. We need to get there and we need to be investing in hydrogen. We need to be reducing our greenhouse gas emissions. We need to be targeting 2050.

Aside from one bold panelist who talked about how we’re paying for this, that was really primarily the sidebar conversation. Almost every break I was in after every panel or every discussion someone was, decarbonization is great, but who’s paying for it? The investment in hydrogen, ammonia, methanol, as the future of the energy transition is expensive. It’s expensive, it’s costly, it requires a public and private partnership, and it’s not yet clear who’s paying for it. Because, of course, there’s a conundrum, and you guys know this, and I know this. People want or think they want sustainable products. They want greener products. They want products with a lower carbon footprint. However, they need to be offering something more. Otherwise they’re not paying for them.

So this is a little bit of a dilemma I see, if we think about some of these products that are very much commoditized, let’s take ammonia, for example. Somebody who’s producing and selling ammonia, you might tell me differently, but the reality is, it is very much a commodity product. And so there needs to be a bigger differentiator. People are not buying on product alone. What is the rest of your differentiation story? And that is something that frankly, we did not talk about a lot here on stage, but I think it’s something to talk about and we’ll be continuing to talk about on The Chemical Show.

Cause as you guys know, I like to talk about the customer experience, how you differentiate your business, how you really create value and you’re not creating value by doing the same thing. You have to create value by understanding your customers. Creating a differentiation, whether it be in product or in service or an offering or how you package it all together. That is where the value comes in.

The second theme that’s really come through is the need for alignment and collaboration. This is really around standards. So at the moment, every country has its own set of standards as it relates to reporting and sustainability and decarbonization, which those are key big things that are driving us, but it also relates to products and how we sell and how we don’t sell. The industry groups have done a great job when we think about harmonization as it relates to chemical products. I think about REACH as an example, while it started in Europe, it certainly had global implications and the industry groups have been very effective in driving standardization and alignment and creating a system that works across the industry and across the globe. That’s not true today when we think about sustainability and ESG measurements with the targets that countries and companies are expecting us to hit.

Marine Schroeder, who is the managing director of Stolt Tankers, she expressed on stage, she said, I wish we could turn all of the people that we’ve got working on reporting, and the complexities of reporting because the reporting requirements are different in every single jurisdiction. If we could turn that investment into those people and their time and resources into innovations to figure out how to become sustainable and decarbonized. Developing the future platform for the industry, both from a product perspective, from a supply chain and logistics perspective, and more. So that is a source of real frustration that I’ve certainly heard, the theme coming through from stage is, that currently we don’t have a lot of great alignment on some of these standards across the globe and we need to get there. The second piece that goes with that is, really the request that we are less prescriptive in terms of how we get to carbon and greenhouse gas reductions. Instead of being prescriptive about the “how”, be prescriptive about the “what”.

Allow the chemical industry and the creative minds across the industry to identify the optimal products, technologies and solutions to get us to a more circular, lower carbon, profitable world that we’re all looking to grow and be part of. The third piece of this and the third theme that really comes through throughout the conference again, both from onstage and offstage as I talk to people across the conference is the fact that the chemical industry is a really vital part of the energy transition. In fact, I spoke with Tony Potter from S&P Global and I’m going to include a clip with Tony, so stay tuned for that. But Tony talked about how we actually need more chemicals in a low carbon energy transition world when we think about moving away from our traditional energy sources like oil and into energy sources like solar, wind and hydrogen. We need more chemical products, number 1, very often the plastics and the other materials that we’re producing are key contributors to light weighting, and therefore reducing the energy demands, as well as then the emissions offsets for the industry. So that’s one factor of it. The other is just the continued evolution of products, innovation, lifestyles, et cetera. So I think there’s no doubt that, and this was a theme that came through, the energy transition and the chemical industry are clearly hooked together.

We’re going to be seeing more of that. So I think there’s an opportunity for innovation. We’ve heard from a number of people across on stage, Karen McKee from Exxon Mobile, and others about the innovation that’s going to be coming through from the industry in order to enable the energy transition. So to sum it up, I would say the pulse and the theme of the week is, the future is bright. There is an upturn. There is a lot of positivity. There is a concern about how we’re paying for it and who is paying for it.

And, are we allowing the experts in the industry, the scientists, engineers, technologists, to really develop optimal solutions for the world as it relates to greenhouse gas emissions reductions? There’s clearly a theme of, “who’s paying for it”. Everyone is clear that the economics have to work, and that’s maybe a big shift, and that was spoken about by one person at the event, about this fact that we’re shifting to where this has to make economic sense. It just can’t make theoretical sense. Sustainability and our reduction in greenhouse gas emissions by 2050 makes perfect sense in theory. However, it also has to make economic sense for companies, for governments, and for individuals in order to support the drive. So anyway, that’s my summary from WPC 2024.

I hope you’ve enjoyed it. If you attended, send me a note, let me know what you heard, what other themes came through for you. I’d love for you to share that with me. 

Conversation with Tony Potter

Now I’m going to be talking with Tony Potter about his reflections from WPC.

Hi, I’m here talking with Tony Potter, who is the head of chemicals for S&P Global and Tony and I were having a great chat before we got started about a variety of things related to chemicals that we’ve been hearing today at WPC. Tony, we seem to be living in a world of oversupply. That’s certainly a concern when we talk to people.

There’s been a big discussion around decarbonization and what it means for chemicals. I think some people see the pros of it and others perhaps see the cons of it. But what do you see as the role of chemicals in the energy transition and in decarbonization?

Tony Potter: Well, thanks for the opportunity to talk with you. I think chemicals are absolutely essential in the path to decarbonization. We no longer just talk about the energy transition. We talk about an energy and materials transition. That’s a reflection that to get to net zero, all materials of fabrication need in themselves to decarbonize. Thermoplastics start off as a relatively low energy intensive product relative to iron, steel, aluminum, or glass.

Whilst the chemical industry needs to decarbonize its processes, chemicals and thermoplastics play a key role in that. In most scenarios that we look at, we see people substituting these higher energy materials for plastic. You can’t lightweight any form of transportation without plastic. No one’s invented a paper car yet. You don’t build wind turbines without plastic and you don’t build solar panels without plastic.

That’s a great perspective. I think the general public doesn’t understand much of that. I’ve had conversations in the recent past about fuel tanks, fuel tanks today are all made out of plastics. Which is why nobody has rusted out fuel tanks in their cars anymore. Whereas, probably two decades ago, that was a major issue, especially if you are working on an old car.

Tony Potter: Of course as we move to EVs, you don’t need that fuel tank. That is true. But as we study the transition to EVs, maybe the composition of the plastics changes slightly, but we think that more plastic is used in an EV than in an ICE.

Industrial oil refinery petrochemical chemical plant with equipment and tall pipes at night. AI generated. WPC

Yeah, that’s really interesting. When I talk with people, there’s a lot of conversation about are we ever going to reinvest in chemicals? So we feel that we’re overbuilt certainly in the commodity chemicals and in plastics. Operating rates are low. We’ve built for a world that’s not this current cycle. We also tend to be very cyclical and we like to, in some cases, buy high and sell low when we’re talking about investments in the chemical industry. Are we going to be investing again? What do you see?

Tony Potter: Yeah, I think it’s inevitable. Every cycle, someone says this is the end of cycles, and it never is. This downturn will end at some point. It is a long, slow downturn, ethylene operating rates are down to 80%. It’s a long, slow haul back to reinvestment type margins until capacity utilization tightens towards the end of the decade. But beyond that, we see a world where oil demand peaks around the end of the decade and then slowly starts to go into decline. We see no such peak for petrochemicals and we’re doing forecasts out more than 30 years.

We’ve never found anything that we could describe as peak polymer. Petrochemical demands will keep on growing as long as the population grows and as long as the wealth of that population grows.

That seems a little bit contrarian. I agree with you on the fact that we all seem to like to use plastics and yet I think about the plastics treaty, we heard Jim Fitterling talk this morning about it going from being about reducing plastics pollution to reducing plastic, and now we’re back to reducing plastics pollution. I think there’s some people that would say that this continued growth pattern maybe cannot continue.

Tony Potter: But what do you grow with if you don’t grow with plastic? There’s no doubt the world has a plastic waste problem and it needs dealing with and legislation is likely to be passed to deal with that. Whether it’s an international treaty or individual governments, plastic in the wrong places is a problem. There’s no doubt that as part of the energy and materials transition, we need to build a more circular economy and plastics recycling is part of that. But at the moment, if I take polyethylene as an example, probably 7-8% of polyethylene globally is mechanically recycled.

We see that number almost tripling in the next ten years, but the underlying demand growth for polyethylene is still such that we see virgin polymer demands continuing to grow. One of the issues is actually building out the supply chain to collect and clean waste, which in itself is carbon intensive. Unless you build a green supply chain, there’s actually a danger you expend more carbon than you save.

Right, because it is intensive to get the recycling and the mechanical piece of it, and it doesn’t exist in many places and even where it does it’s not always fully utilized. I certainly know that in my own community, many people don’t recycle, even though we have curbside recycling.

Tony Potter: In the U.S. there are over 80 different types of legislation not even at the state level, but from municipality to municipality of what can and can’t be recycled. It’s crazy.

It’s complicated. It’s very complicated. Well, Tony, thank you for joining us. I appreciate your perspective.

Tony Potter: You’re welcome.

Conversation with Rahul Kapoor

Now, I’m here with Rahul Kapoor from S&P Global here at WPC 2024. We’re going to be talking about a few things about the shipping industry and what’s going on there. So, Rahul, thanks for joining me.

Rahul Kapoor: Thanks, Victoria. Good to be at WPC.

So, first of all, let’s just talk about what’s going on in shipping today.

Rahul Kapoor: Sure. I think if you look at the shipping industry or rather the shipping markets, what we are seeing today is it’s in the midst of what we call a geopolitical storm. If I take you back three years, it started with COVID. We had all the supply chain disruptions, massive ones at the end. So we had port blockages, we had all the stuff at the other end of the world, and we were waiting for all the shipments to arrive in the U.S. and other markets.

So we went through that, it normalized, freight rates corrected, freight rates actually went to record highs, we were actually looking at 20,000 per TEU, and that has made an impact on many of the chemical companies. The whole supply chains were disrupted, we went through that. Then we had the Russia-Ukraine war. I think that led to many trade flow changes. When you look at the petchems, when you look at the oil markets and so on, so that had an impact as well. Just recently, back in November, we had this Red Sea crisis. So back to back, shipping has been facing some of these geopolitical crises.

Yeah, let’s talk a little bit more about the Red Sea, because obviously we thought things had normalized and then along comes the Red Sea crisis, which is a crisis not just for shipping. It’s certainly a humanitarian crisis and a crisis for the people in the region. But as we think about the relationship and what it means to chemical shipping, can you talk a little bit more about that?

Rahul Kapoor: I think there are two parts to it. So first of all, the Red Sea or the Suez Canal is a global artillery for maritime trade. You can call it a super highway, the 20,000 ships which pass through that which are around 25% of the global container trade, then you have almost 8 million barrels of products and crudes, including chemicals passing through it, both eastbound and northbound. And then you have LNG LPG, right? So it’s, it’s a major highway.

What we have to understand, is that within the commercial shipping, there’s a principle of freedom of safe navigation. That’s been severely challenged. These are commercial ships which are passing through a narrow channel and they become an easy target. The only time we’ve seen that is back in 1980s when we had the tanker wars. But otherwise commercial shipping, despite the wars and all of that, continues to flow through. So essentially coming here we’ve seen almost 80% of container trade, which has been diverted. What that means is you’re spending more time at sea, an additional two weeks on. So that is high inventory cost. We did hear about some of the European customers, particularly suffering because of this high inventory cost as well as time at sea. So there is a bit of a disruption.

The good thing was demand is soft as we were talking earlier. So I think that has helped and some of the capacity has been coming back. So overall the impact on prices, freights are still higher, but it’s not as bad as COVID. It is bad, but nothing comparable to what we had back then.

Right. So I think most chemical companies would not think that demand being soft is a good thing. But as you point out, in context of combining it with the shipping crisis, it certainly has eased some of the concerns and the height of what the disruption could really be. That’s a good idea. So let’s talk about how these geopolitical challenges start factoring in. There’s a couple of things when I talk with companies that we’re talking about, one of which is regionalization, and when we look at potentially shifting to more regional supply chains, and in some ways regional independence of supply chains.

Rahul Kapoor: Certainly. I think if you go back the global economy has benefited from globalization, since China joined WTO, you’ve seen an increase in the global trade coming out of 2012 or 2014, when we started seeing some of these companies as well as some of the policymakers talking about a bit of protectionism. We started seeing some of the tariffs which came about. So the global trade still continues to grow. But COVID actually brought what we call supply chain resilience. Last year at WPC, we actually talked about that, the supply chain resilience and this year we’re doing decarbonization. Supply chain resilience is very important. That was challenged massively in the COVID times. So there is a small effort towards what you would call friendshoring.

 But China still stays at the center of the global factory of the world. It’s a very long drawn process. We’ve seen some of that move to Vietnam, India, and other places, but it’s a very slow process I would say.

Yeah, definitely. One of the things I’ve seen and have heard is that some of this regionalization is more North-South instead of moving East-West. Which I also think ties into decarbonization, because when I think about supply chains and the effect that they have on emissions, and certainly Tier 3 emissions, due to the supply chain it makes sense to have shorter supply chains. So what do you see happening from that space?

Rahul Kapoor: That’s one of the key topics that we are covering at WPC. I’m doing a track chairing called “Decarbonization of Supply Chains.” The first session is about this chemical value chain and the second is about the transportation. It is at the core of what’s going to happen over the next 15, 20, 30 years. If you look particularly on the transport side, and we talked about the Red Sea, energy security essentially means that the ships which are rerouting now are emitting three to four times more. So in the times of energy security, the sustainability goals take a hit because the ships have to reroute, they’re speeding up, they’re spending more time at sea and burning more fuel. But if you look at where we are coming from, as well as what we look at, the supply chains, particularly on the transport side are going from what you used to call a single bunker or bottom of the barrel, heavy fuel oil, low sulfur fuel oil to what we have today, ammonia, methanol, we’re talking about hydrogen, carbon capture. It’s a multi fuel future, which is going to be costlier. So it will have an impact on the chemical value chain. It will have an impact on the global supply chains in terms of higher costs.

So one of the sessions I was in earlier today talked about how the costs will be coming down when we think about energy transition broadly, not specifically about the decarbonization of supply chains. But as these technologies get more robust, higher supply availability of energy. So, how do we get to the point where we can actually start coming down the cost curve? Should we expect to see that in decarbonization of supply chains?

Rahul Kapoor: We should expect to see that, but you have to take the cost up front. So the challenge is the green methanol or green ammonia, those are very expensive today. The capacities have to come in and the industry, particularly in the supply chain side is dealing with that chicken and egg situation. Whether you will get that alternative fuel today or whether you’ll get it in 2027 or 2033. So the capacities have to be set up. The initial cost is going to be higher, and as it works in the free market, all of that should settle down.

Yeah, awesome. So if we think about just three trends as it relates to shipping and decarbonization, what are the big three? What would should we be looking for?

Rahul Kapoor: I think the first one would be supply chain resiliency. I think the three events which we’ve seen in a matter of three to four years have shown you that supply chains being resilient is very important. So the companies are talking about that and we continue to talk about. Next is diversification of supply chains. The industry is very dependent on certain regions in that sense. A bit of that coming back to the Americas and a bit on the Europe side. Lastly is everybody needs to take a part in decarbonization. So it’s a process. We have to be patient, it will take some time, but we’ll get there.

Awesome. Rahul, thank you for this.

Rahul Kapoor: Thank you, Victoria, for having me.

About Rahul and Tony:


Rahul Kapoor

Rahul Kapoor is the Vice President and Global Head of Shipping Analytics & Research for S&P Global Commodity Insights and is based in Singapore.

Rahul leads an integrated commodity analytics product management, data science and research team. As a business head, he is responsible for driving new product growth for our analytics products Commodities at Sea and Freight Analytics. A subject matter expert in the maritime industry and financial markets, Rahul is a thought leader with proven credentials in market analysis forecasting, shipping economics and commodity market developments. He is a regular speaker at major conferences and client events globally, and is frequently interviewed by both print and visual media. Most recently, he was at Bloomberg Intelligence and earlier headed Drewry Financial Research Services Ltd. He has also worked as senior equities analyst at RS Platou Markets and Nomura.

Rahul holds a Bachelor of Science in Marine Engineering from BITS, Pilani and a Postgraduate in Management from IMI, New Delhi, India.



Tony Potter

Tony Potter serves as Global Vice President at S&P Global Commodity Insights, leading specialty chemical research and analysis in the Asia-Pacific region.

Tony has more than 30 years of experience in the chemical industry in Europe, the Middle East and Asia. His expertise includes market analysis, strategy development and investment analysis. He has led numerous studies, including project feasibility through acting as market and technical consultant to lenders, market and competitive analysis, benchmarking, organizational design and strategy development. He currently leads chemical research and analysis teams in with teams in Singapore and Tokyo. Tony previously ran his own independent consulting practice, specializing in competitive and economic analysis of the oil, petrochemical and polymer industries, including business interruption loss analysis for the insurance industry and benchmarking of the global aromatics industry. He began his career in 1983 as a graduate recruit with Exxon Chemical in the UK, where he held a number of plant supervision, project management and planning management positions before transferring to Exxon’s European head office in Brussels to work as an investment planning manager for the Basic Chemicals business group and industry analysis manager.

Tony holds a Bachelor of Science in chemical engineering (Hons.) from Imperial College, London, United Kingdom.