Sumitomo Chairman: Global Shifts Heighten Petrochemical Volatility
April 9, 2011 - San Antonio, TX
From Chemical Week, April 9, 2011
by Robert Westervelt
Petrochemical makers face continued volatility as globalization and excess liquidity transform the economy, says Hiromasa Yonekura, chairman of Sumitomo Chemical. Yonekura received the 14th annual Petrochemical Heritage Award at the Chemical Heritage Foundation/National Petrochemical and Refiners Association (NPRA) Symposium on Entrepreneurship and Innovation held March 29 as part of NPRA’s International Petrochemical Conference in San Antonio.
“When something happens somewhere people know it immediately and react instantly,” Yonekura says. The origins of the current “great recession” underscore how closely linked global markets have become and how quickly information is transmitted, he says. The crisis started in the U.S. subprime mortgage market and rippled across the global economy. “Markets are becoming more inclined to overreact and being led into a feeding frenzy,” he adds.
Excessive liquidity continues to fuel volatility in financial and commodity markets—including financial derivatives, crude oil, currencies, and metals—and has had a tremendous, and distorting, impact on the world economy, he adds. “Markets historically have played an important role in balancing supply and demand and getting prices right,” Yonekura says. “Awash in capital, however, markets seem to be governed by forces of speculation and this is generating considerable imbalances and fluctuations.” . . .
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