By Abdulla Fardan and Glen Carey
Nov. 10 (Bloomberg) -- Petrochemical prices tumbled 50 percent since October on weaker demand because of the global credit crisis, said the chief executive officer of Saudi Basic Industries Corp., the world's biggest chemicals maker by market value.
``The price retreat started precipitously from the end of September and early October,'' Mohamed al-Mady said today in an interview with Dubai-based al-Arabiya television. ``We were expecting the price to fall next year.''
The global credit crisis and slowing economies threaten Sabic's payback on last year's $11.6 billion acquisition of a plastics business from General Electric Co. The purchase, the largest by a Gulf-based company, added a network of factories making resins and thermoplastic sheets used in cars, roofs and lighting to Sabic's business just as the auto and construction industries cut output.
Sabic's fourth-quarter net income will be affected by the falling prices for petrochemical products, al-Mady said.
The company reduced its polyethylene price to 3,700 riyals per ton from 7,000 riyals per ton, according to the Jeddah-based Okaz newspaper on Nov. 5. It was also expected to cut its polypropylene prices 35 percent to 3,788 riyals per ton this month from 5,813 riyals per ton in October, al-Riyadh reported Oct. 27.
To contact the reporter on this story: Glen Carey in Dubai at gcarey8@bloomberg.net. Abdulla Fardan in Bahrain at afardan@bloomberg.net
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