Global Feedstock Cost Variations

One aspect of the ethylene/polyethylene business that has been extremely important since the 1970s has been the enormous variation in feedstock costs arormd the world. In the early years of the polyethylene business, from about 1940-1970, feedstock costs did not vary a great deal aroimd the world due to low-cost crude oil in which crude oil demand did not 

Since about 1970 through 2010, the low-cost feedstock advantage found in the Middle East resulted in the investment of enormous amounts of capital in the Middle East for the construction of ethylene/polyethylene petrochemical complexes in this region for export to other regions. The high levels of return on capital resulting from the very low ethylene manufacturing costs for the manufacture of polyethylene in the Middle East could not be matched anywhere else in the world. 

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