How Did the Mid-East War Shock Asian Polyolefin Markets Just in One Week?

The Middle East war has completed its first week, sending shockwaves across global markets. As the region is not only a major exporter of crude oil, LNG, and LPG, but also a key supplier of petrochemicals, the impact has quickly spread to Asian polymer markets. The key question now is whether the disruption will deepen in the coming weeks.

Asian petrochemical markets witnessed a rapid chain reaction:

Energy and feedstock costs surged

Force majeures were declared and crackers cut operating rates

Freight surcharges emerged

PP and PE prices climbed across Asia

At the same time, many sellers have withdrawn their offers, waiting for clearer market direction amid the ongoing uncertainty.

However, the impact has not been uniform across the region.

In China, the shock has mainly been felt through the cost side. Rising feedstock prices have squeezed margins, while limited feedstock availability has forced several crackers to trim operating rates or declare force majeure.

Meanwhile, Southeast Asia and India are facing a double pressure — higher costs and tightening supply of Middle Eastern PP and PE, on which these markets remain heavily dependent.

Market sources reported that China increased re-export offers to Southeast Asia last week as buyers searched for alternative supply sources. At the same time, India’s domestic polymer markets recorded their largest gains since the pandemic, reflecting the sudden tightening of supply.

If disruptions linked to the Middle East conflict persist into the coming week, market participants warn that polyolefin prices across Asia could see further sharp increases as supply chains remain under pressure.

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