Shell chemical loss would be buyer's gain

Petrochemical plants turn inputs such as ethane and naphtha into building blocks like ethylene, which are then used to make plastics and other materials. A few numbers clearly display why Shell may be keen to move on. The group's chemicals portfolio had around $25 billion of capital employed in 2024 and generated a minus-2% return on that money, the company revealed at a 2025 investor event. Its big Monaca polymers complex in Pennsylvania, which would be a large part of any possible U.S. asset sale, alone accounted for about $14 billion of the invested capital.

It may be a good time to buy, since the industry's backdrop is starting to look less bleak. First, U.S. producers benefit from plentiful domestic ethane, whereas many Asian rivals often depend on oil-derived naphtha. The latter has been tricky this year given the disruption in the Middle East, giving American plants like Shell's an advantage. Exxon, for example, said margins in its North American chemicals operations jumped roughly 180% between the first and second quarters. More broadly, prices are higher across the board, which should help all producers: ethylene prices in Northeast Asia have rebounded about 30% from their July trough, according to LSEG data.