European Petrochemical Decline Puts Pressure on Versalis

Eni’s chemical subsidiary reported an adjusted EBIT loss of €178 million in the third quarter of 2026, compared with a €65 million loss in the previous quarter. However, the result represented a slight 5% improvement compared to the same period in 2025, when the company recorded a €188 million loss.

The deterioration largely reflects a renewed decline in European petrochemical margins, following a temporary recovery in the second quarter after supply disruptions caused by the Strait of Hormuz crisis.

According to Eni, the rapidly rising costs of petroleum feedstocks, energy, and plant utilities cannot be passed through via the selling prices of commodity plastics, which remain under pressure from weak demand and competition from producers with more favorable cost structures.
Global overcapacity has intensified these pressures, pushing product profit margins below the already low levels seen in the third quarter of last year.

The chemicals restructuring program continues to deliver benefits through operational optimization, cost efficiency, and plant closures implemented in 2025. These measures have partially offset the negative impact of market conditions.

In the first nine months of 2026, Versalis reported an adjusted operating loss of €401 million, compared with €615 million in the same period of 2025, representing a 35% improvement. These figures demonstrate progress achieved through restructuring and underscore the company’s continued engagement with developments in the petrochemical market.

In the commercial segment, according to Eni’s data, sales of chemical products rose by 3% in the third quarter, from 590,000 tonnes in the same period of 2025 to 600,000 tonnes. Despite the closure of production facilities in Brindisi and Priolo as part of its restructuring plan, the group reported an increase in output, particularly in polymers.
Over a nine-month period, sales volume declined by 11%, falling from 2.1 million tons to 1.86 million tons. In the third quarter, the average utilization rate of the chemical plant dropped to 43%, compared with 47% in the previous quarter and 57% in the quarter before that.

Meanwhile, the industrial transformation of the Brindisi and Priolo sites is ongoing, as part of Eni’s separate accounting for its chemicals business. The transition also includes the decommissioning and environmental remediation of petrochemical sites, with a pre-tax adjusted operating loss of €77 million in the third quarter, reflecting costs associated with preparing facilities for future investments. Provisions for decommissioning and environmental remediation are classified as special items.

In the first nine months of 2026, capital expenditures in the chemicals business amounted to €66 million, down 48% from €127 million in the same period of 2025. According to Eni, the investments were primarily directed toward circular economy projects and measures to maintain plant integrity and safety.