Crude Oil Price Surge Dominates Petrochemical Industry Costs

Crude oil price increases have taken center stage in the petrochemical industry, driving up costs across the board. However, according to Wood Mackenzie, supply shortages have been limited, with only a small share of PX, PTA, and MEG production coming from the Middle East.

Around 20% of Europe's PX supply comes from the Middle East, but this has not led to outright shortages. Instead, high crude oil prices are the dominant cost driver, pushing up feedstock costs and affecting prices across the petrochemical value chain.

Wood Mackenzie senior research analyst Santiago Castro notes that European buyers initially moved quickly to secure supply from domestic producers, pushing prices up sharply in March and April. However, they soon reverted to a wait-and-see posture as imports continued.