Data & Models
Probe Economics LLC, began as an econometric modelling shop at a U.S.
university; so models and databases are an important, if not the most important, core
competency of the company. Most of Probes models go back to "Economics
101," which taught us that prices and volumes are determined by the intersection of
supply and demand curves. Probe personnel have command of, and have used successfully in
business situations, some sophisticated techniques, including mixed-integer programming,
dynamic optimal control theory, Rockefellar duality theory, regional input-output models,
and non-linear equation estimation, but these techniques all hark back to that simple,
"Economics 101" principle.
Most of Probes modelling techniques can be found in academic
journals and textbooks, but no-one, other than Probe, has applied them successfully to
real chemical industry business problems. We know which techniques will work, stay within
a budget and deliver results that the client can understand and use. Even though more
sophisticated techniques are available, we often recommend a simpler approach for the
client, in order to stay within the budget and mesh better with the clients way of
thinking and working.
One of Probes better-developed models is for world petrochemicals. This model,
which is coded into thousands of lines of linked electronic spreadsheets, can be depicted
roughly as follows:
Typical of many of Probes models, the analysis begins at the top
and proceeds downward (sometimes called a "Top-Down" approach). It begins with
macro factors such as a countrys resource endowment, demographics, stage of
development, political system, trade strategy and economic output (GDP). The factors drive
the supply and demand for petrochemicals and polymers, as well as the development of the
energy and refining sector that is so important to petrochemicals. Oil prices and resource
endowments determine the level of oil and gas drilling and, ultimately, the supply of
hydrocarbons for use in chemical production. Demographics and income levels determine the
demand for heating oil, gasoline and other refined products, which in turn determine
refinery configuration and the prices of chemical feedstocks. In the end, this methodology
generates internally-consistent and reasonably-accurate forecasts of chemical supplies,
demands and prices by country and region.
Probe personnel have developed and successfully used similar models for
chlor-alkali, other inorganic chemicals, rubber chemicals, oil and gas, uranium and a wide
variety of other materials. This body of knowledge and experience positions Probe to build
a model that addresses your specific business problem and provides insights and approaches
that would not otherwise be apparent.
In the following, we provide a list of the chemicals, polymers, hydrocarbons and
economic indicators covered by various Probe models and databases.
CHEMICALS, POLYMERS, HYDROCARBONS
AND ECONOMIC INDICATORS
COVERED IN PROBE MODELS AND DATABASES:
A. Multiclient Reports (1)
Energy and Economic Indicators
For the U.S.:
GDP Price Deflator
U.S. Unemployment Rate
Value of Dollar
Crude Oil Price
Natural Gas Price
Electric Power Costs
Price Index for Chemicals
Chemical Plant Cost Index
For Most Other Countries and Regions:
Motor Vehicle Registration
Feedstocks and Oxygenates
No. 2 Heating Oil
Octane Barrels (Valuation)
Low Sulfur Residual Fuel Oil
Monomers and Intermediates
Vinyl Chloride Monomer
B. Reports, Databases and/or Models Updated On An
"As-Needed" Basis (2)
1. Some multiclient reports are updated annually and others less often.
Some reports have a full, quantitative work-up of supply, production, exports, imports, demand, cost,
margin and price, while others only deal with one or two of these.
2. Existing materials may include only a database or cost
model, or may include a complete study. Some portions of this information are updated
every year or two, while other portions may not have been updated for 10 years.
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