Economic Overview Overall, the global economy in 2023 experienced a continued slowdown from the previous year. Despite a boost brought on by the recovery of the service sector, the manufacturing sector continued to show a slowdown, in line with the slump in global demand due to concerns over consistently high inflation rates. Additionally, the implementation of tight monetary policies by central banks in various countries to control inflation through interest rate adjustments revealed vulnerabilities in the financial system and led to an increase in costs for the business and households sectors. Meanwhile, the Chinese economy did not recover as the anticipated rate, and the country remained beset by challenges in the real estate sector. The economic outlook for the year 2024 will likely exhibit a persistent economic slowdown from 2023 due to increased economic challenges, such as China’s real estate crisis, declining business and consumer confidence, and tight money, which will affect the demand, leading to economic uncertainties across the world and volatility in commodity goods prices. Furthermore, geopolitical tensions, including the situation in Russia and Ukraine as well as the ongoing Israel-Hamas conflict, will remain a significant risk factor that requires close monitoring. Any violent flare-up can have repercussions on global economic expansion and lead to an increase in inflation rates. As such, the overall global economic growth will remain depressed. In light of all the factors above combined, it is anticipated that the overall growth, which was at 3.5% in 2022 and dropped to 3.0% in 2023, will slide further to 2.9% in 2024 (according to the IMF as of October 2023). However, the overall economy is projected to gradually improve in the latter half of the year, thanks to international economic stimulus measures and the improving trend in the manufacturing sector. Market Overview - Upstream Refinery and Shared Facilities Market Overview in 2023 In 2023, crude oil prices saw a reduction as the RussiaUkraine conflict grew less violent, which in turn alleviated supply concerns in the energy sector as Russia continued to export its oil to other countries instead of Europe. The global economy, however, continued to be pressured by various factors, including inflation, interest rates, and crises in the banking and real estate sectors. Weak economic indicators, especially in China and Europe, also depressed oil prices and oil demand in 2023, while the economic recovery of China, the world’s second largest crude oil consumer after the United States, remained sluggish after its reopening. With the oil demand affected by economic concerns, OPEC+ (OPEC and allies) announced production cuts to maintain a pricing balance. Saudi Arabia declared a reduction in oil production by 1 million barrels per day from July to the end of 2023, while Russia announced a cut in oil exports by 300,000 barrels per day until the end of 2023, signaling a clear intent to preserve a pricing balance. Additionally, during Q4/2023, in light of instability in the Middle East resulting from the conflict between Israel and Hamas, an armed militant group in Palestine, there were concerns the unrest would spread to other countries in the Middle East, a crucial global crude oil production region. This led to the tightening of the oil market and caused crude oil prices to rise in Q3 and Q4. The average Dubai crude spot price in 2023 dropped to US$ 82.1 per barrel, a decrease of US$ 14.2 per barrel compared to 2022. Market and Competition 67 PTT GLOBAL CHEMICAL PUBLIC COMPANY LIMITED Form 56-1 One Report 2023
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