Europe’s chemical industry has reached a “tipping point”, according to a new report by economic advisory firm Oxford Economics commissioned by energy company Ineos. It warns that energy costs, regulatory pressures, and foreign competition could wipe out half of Europe’s ethylene capacity by 2030. There are signs that this could also reshape demand for industrial gases across the continent.
The chemical sector is Europe’s fourth largest industry and a major consumer of gases such as hydrogen, oxygen, and nitrogen for feedstock, synthesis and refining. As output declines, demand for these gases could weaken in key production hubs in Germany, Belgium, and France.
According to Oxford Economics, production in Europe’s major chemical markets has fallen to its lowest level in a decade. Output is down by 30% in the UK, 18% in Germany, 12% in France, and 7% in Belgium compared to 2019.
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