Octane blending
Overview
Demand for high octane components vary throughout the year depending on seasonality, premium gasoline market share, and refinery performance. Stricter gasoline standards also contribute to demand for high octane components.
Among the list of high-octane components are reformate, alkylate, MTBE, ETBE, toluene, xylenes, ethyl benzene, and others. Some of these components primarily see demand from the chemical market but could be diverted to the gasoline pool if there are returns in that segment.
Each blendstock has specific octane rating and rvp content that determines its value in the gasoline pool. Gasoline blenders will look at market prices for each of the octanes and see how it relates to the value in the gasoline pool. In the summer of 2023, high volumes of ethylbenzene were diverted to the gasoline instead of the production of styrene, as styrene prices fell below ethylbenzene blend value.
MTBE is a high-octane component for gasoline blending, but only used in some countries. MTBE demand has been led by growth in Asia, Middle East, and Latin Markets. Other regions have focused on increased biofuel usage which includes ethanol and ETBE.
Argus’ experts will help you determine what trends to track and how to stay competitive in today’s ever-changing global markets.
Latest octane blending news
Browse the latest market moving news on the global octane blending industry.
EIA raises US NGL production, demand forecasts
EIA raises US NGL production, demand forecasts
Houston, 8 April (Argus) — The US Energy Information Administration (EIA) raised its 10-year outlook for average production of natural gas plant liquids (NGLs) by 14.4pc. In its Annual Energy Outlook (AEO), the EIA estimated production of NGLs would average 8.85mn b/d from 2026 to 2035, up from the estimate of 7.74mn b/d for that period in its report last year . By 2050, production will reach 11.3mn b/d, EIA said, a 32.3pc hike from the agency's previous 2050 forecast. Consumption of hydrocarbon gas liquids (HGLs), which the EIA defines as ethane, propane, normal butane, isobutane, natural gasoline, and refinery olefins, is projected to average 3.82mn b/d over the next 10 years, up from the 3.69mn b/d forecast in the 2025 AEO. The agency continues to expect much of this demand to come from the industrial sector, including petrochemical manufacturing. EIA forecast 3,710 trillion Btu/y of industrial-sector HGL consumption between 2026-2035, up from its 3,630 trillion Btu/y forecast for the period last year. EIA also raised its estimate for domestic propane use in the residential, commercial, and transportation sectors across the period to 727 trillion Btu/y, up from 697 trillion Btu/y as estimated in 2025. The increase was almost entirely attributable to the residential sector, which the agency predicts will consume 485 trillion Btu/y, up from its previous 456 trillion Btu/y forecast for the period. By Joseph Barbour Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
Saudi Sadara petchem site shuts down on US-Iran war
Saudi Sadara petchem site shuts down on US-Iran war
London, 31 March (Argus) — Sadara Chemical Company, a joint-venture between US-based chemical company Dow and Saudi Arabia's Aramco, has shut down production temporarily at its Jubail site in Saudi Arabia because of the US-Iran war, according to a regulatory filing. The cause for the shut down was cited as "ongoing disruption to Sadara's supply chains". The company does not currently have an estimate of when production will return, according to the statement. Shipping through the strait of Hormuz has remained disrupted since the start of the US-Iran war on 28 February. And earlier this month, Iran threatened the petrochemical complex with missile strikes , but the site so far has not been hit. The site can produce 1.5mn t/yr of ethylene and 400,000 t/yr of propylene and is integrated to produce 750,000 t/yr of LLDPE/HDPE, 350,000 t/yr of LDPE, 330,000 t/yr of propylene oxide and 360,000 t/yr of ethylene oxide. It has a capacity of 200,000 t/yr of TDI production and 400,000 t/yr of MDI production. The site can also produce 150,000 t/yr of ethanolamines which are distributed by Saudi Arabia petrochemical producer Sabic. Sabic declared a force majeure on ethanolamines supply in late March . Dow Chemicals, which holds a 35pc stake in Sadara and markets a significant share of its ethanolamines output, declared force majeure on 10 March in some markets, including Europe. Dow said it was unable to load volumes at Jubail because of logistics disruptions stemming from the war. By George Barsted Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
S Korea starts review of Lotte Chemical, YNCC merger
S Korea starts review of Lotte Chemical, YNCC merger
Singapore, 20 March (Argus) — South Korea's Ministry of Trade, Industry and Resources (Motir) and the Korea Fair Trade Commission have started a preliminary review of Lotte Chemical's proposed merger with Yeochun NCC (YNCC) as part of the country's initiative to restructure the petrochemical segment. Under the proposed plan, Lotte Chemical will spin off part of its petrochemical operation in Yeosu, including its cracker and downstream units, establishing a new entity which will be merged with YNCC. For the downstream sector, the shareholders of YNCC — DL Chemical and Hanwha Solutions — will sell part of their downstream assets to YNCC. After the merger, Lotte Chemical, DL Chemical and Hanwha Solutions will each hold one-third stake in YNCC. The new business will focus on producing high value-added products, including linear density polyethylene (LDPE) and polyolefin elastomer (POE) for medical use, according to a statement released by Motir. This is the second merger review Motir is conducting after South Korea initiated a restructuring plan for its petrochemical industry to slash 2.7–3.7 mn t/yr of ethylene capacity, or up to 25pc of their total cracking capacity on August 2025 . Motir first approved the merger plan between Hyundai Chemical and Lotte Chemical in Daesan in February. Lotte Chemical owns two crackers in South Korea — one in Yeosu with an ethylene capacity of 1.2 mn t/yr, and another in Daesan with ethylene capacity of 1.05 mn t/yr. YNCC operates three crackers in Yeosu — its No.1 cracker can produce up to 900,000t/yr ethylene, while its No. 2 and No. 3 crackers produce 915,000t/yr and 500,000t/yr of ethylene, respectively. YNCC's No. 3 cracker has been idled since August 2025 because of margin concerns. Hanwha Solutions operates a 1.458 mn t/yr ethylene dichloride plant in Yeosu alongside a 330,000t/yr LDPE plant, and a 355,000t/yr linear low-density PE /high-density PE (LLDPE/HDPE) swing plant. Daelim has a 305,000t/yr HDPE unit and a 400,000t/yr LLDPE/HDPE swing plant in Yeosu. The petrochemical industry in Asia has been suffering from negative margins since 2022 because of oversupply from expanding capacities in the region, especially in China. Weak downstream demand has further weighed on production margins, putting pressure on cracker operators since early 2022 . By Toong Shien Lee Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
Japan’s petchem firms to raise PE, PP sales prices
Japan’s petchem firms to raise PE, PP sales prices
Tokyo, 19 March (Argus) — Japan's polymer producers Japan Polyethylene, Japan Polypropylene and Prime Polymer will raise their polyethylene (PE) and polypropylene (PP) sales prices starting from April delivery, the firms have announced. Japan Polyethylene plans to raise all its PE sales prices by more than ¥90/kg ($0.56/kg), while Japan Polypropylene aims to increase all its PP sales prices by more than ¥80/kg, the companies said on 19 March. Fellow polymer producer Prime Polymer will also raise its PE and PP sales values by more than ¥90/kg starting from April, the firm announced on 17 March. The companies foresee domestic naphtha prices to rise above ¥100,000-110,000/kl along with surge in crude oil prices, due to the US-Israel war with Iran. The increases are larger than the price hikes of more than ¥45/kg in March 2022 for both Japan Polyethylene's PE and Japan Polypropylene's PP, in response to Russia's invasion of Ukraine. Prime Polymer's price increases are also larger than its previous PE and PP price hikes in March 2022 which were over ¥35/kg. Japan Polyethylene and Japan Polypropylene also expect shortages of feedstock ethylene and propylene to impact polymer production. But they declined to disclose further details of their manufacturing situations, including current plant operating rates and output volumes. Prime Polymer also cited the uncertainty of naphtha and consequently its procurement of feedstock ethylene and propylene. But the company did not respond to Argus ' inquiry for further details. Japan Polyethylene has low-density PE output capacity of 562,000 t/yr and high-density PE production capacity of 423,000 t/yr, according to the Japanese ministry of economy, trade and industry (Meti)'s latest survey as of the end of 2024. The firm is held 58pc by Mitsubishi Chemical's wholly-owned subsidiary Japan Polychem and 42pc by petrochemical firm Japan Polyolefine, a joint venture of refiner Eneos and petrochemical firm Resonac. Japan Polypropylene owns PP production capacity of 765,000 t/yr, Meti's survey shows. The company is held 65pc by Japan Polychem and 35pc by JNC Petrochemical, a wholly-owned subsidiary of chemical producer Chisso. Prime Polymer owns manufacturing capacities of 600,000 t/yr PE and 1.26mn t/yr PP. The company is held 65pc by domestic petrochemical producer Mitsui Chemicals and 35pc by refiner Idemitsu. Other Japanese petrochemical companies have faced similar issues. Kaneka will also raise sales prices of its polyvinyl chloride (PVC) by more than ¥35/kg because of rising feedstock costs, while Shin-Etsu has reduced domestic PVC output and will increase domestic sales prices for PVC by more than ¥30/kg. By Nanami Oki Send comments and request more information at feedback@argusmedia.com Copyright © 2026. Argus Media group . All rights reserved.
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