EU has systematically destroyed its petrochemicals sector

British billionaire Jim Ratcliffe, founder and head of the petrochemical giant Ineos Group, has stated that the high cost of electricity and carbon have undermined the competitiveness of the European petrochemical industry, sending it into a state of decline.
In an interview with Bloomberg TV, Mr Ratcliffe said, “It is now extremely difficult to engage in petrochemicals in Europe.” He added that there are fewer and fewer players left in this industry. "I've never seen anything like it in my entire life."

The sharp rise in energy prices after 24 February 2022 and pressure from competitors from regions with lower production costs, primarily Asia and the United States, forced European companies to stop production and transfer it to other countries and regions. According to Ratcliffe, the price of electricity in Europe is now five times higher than in North America, making competition almost impossible.
It is also important to note the significance of the petrochemical industry. Its products are used in a wide range of applications, from everyday items such as detergents to industrial and construction materials such as plastics and chemical fibres. The petrochemical industry is a vital contributor to economic growth and development. It is therefore not surprising that in Europe, this industry accounts for almost 10% of all industrial production. It is sufficient to note that prior to the recent downturn, the industry's sales were approaching 60 billion euros.
Following 2022, European petrochemical capacity began to decline. BASF SE has been reducing production at Germany's largest industrial site in Ludwigshafen for two years, Exxon Mobil Corp. has ceased production at its largest refinery in France, and LyondellBasell announced in May a downward review of its European production policy. This is not an exhaustive list of petrochemical companies that have ceased production and closed petrochemical plants in the Old World.
According to Jim Ratcliffe, the second-richest Briton with a fortune exceeding $15 billion, the difficulties currently being experienced in Europe are clearly visible in the income structure of his main company. The USA is now generating significantly higher profits from production than Europe, despite the fact that just 10 years ago the opposite was true.
Ratcliffe believes that the collapse occurred not only in continental Europe, but also in his native British Isles. “There's very little petrochemicals left in the UK,” he laments. “Our petrochemical industry has come to an end!”

In addition to Jim Ratcliffe, more than 70 representatives of the petrochemical industry in Europe are expressing concern about their situation. They are requesting that the European Commission reduce the price of electricity and ease the restrictions imposed on the industry by the “green” agenda that is prevalent on the continent. Otherwise, they believe it will be impossible to restore the region’s petrochemical industry to its former competitiveness.

“Energy is a crucial factor in the economy,” Ratcliffe explains. “The United States and other regions are attractive places to work because energy is affordable and there are no carbon laws.” The high cost of resources in Europe is a consequence of its "disconnection" from hydrocarbon supplies from Russia, in which the same Americans played a very active and extremely unpleasant role. One example of this is the undermining of the Nord Stream and Nord Stream 2 gas pipelines. Despite the price of gas having stabilised, it remains historically high. Furthermore, Europe does not officially receive Russian oil.
The duration of the crisis period, as indicated by speakers on this topic, is a clear indication of the severity of the situation.

Jim Ratcliffe, an official representative of the Association of German Petrochemical Industries VCI, concurs, stating that production has declined significantly over the past two years.

Such a significant decline has not been seen since the global financial crisis, he emphasises. European petrochemical company owners are concerned that the industry will not recover to its pre-crisis levels following the crisis in Ukraine.