Global petrochemical shakeup accelerates with EU at the epicenter

A wave of closures, divestments, and strategic reviews is sweeping through the global petrochemical industry as companies respond to China’s massive capacity expansion and persistently high production costs in Europe, Reuters reported. The European Union is bearing the brunt of this restructuring, with several large players either exiting assets or shutting down operations entirely. In contrast, producers in the US and the Middle East remain relatively insulated, while Asian firms are scaling back more cautiously.

Europe hit the hardest

Among the most significant moves, US-based LyondellBasell entered exclusive talks in June to sell four European olefin and polyolefin plants—located in France, Germany, the UK, and Spain—to Munich investment firm AEQUITA. The company is also evaluating options for its remaining sites in the Netherlands and Italy.

Similarly, Dow Inc. announced in July that it would close three European sites: an ethylene cracker in Böhlen and chlor-alkali and vinyl facilities in Schkopau, both in Germany, as well as a siloxanes plant in Barry, UK. Earlier this year, Dow also idled a cracker in the Netherlands.

ExxonMobil closed its steam cracker and chemical operations in Gravenchon, France, citing more than €500 million in losses since 2018.

Meanwhile, Shell completed the sale of its energy and chemicals park in Singapore—including a refinery and ethylene cracker—and is now reviewing its global chemical business, particularly in Europe and the US, with Morgan Stanley advising on the strategic review.

BP also announced it is seeking buyers for its Ruhr Oel complex in Germany, which includes a refinery, cracker, and downstream assets. Other European majors are following suit. TotalEnergies plans to close its oldest steam cracker in Antwerp by 2027, warning of a significant ethylene surplus in the region.

Eni will close Italy’s last two steam crackers—located in Brindisi and Priolo—by the end of 2025 and has already closed a polyethylene plant in Ragusa. Meanwhile, Poland’s Orlen is scaling back its olefins project, delaying output to 2030 and aiming to cut investment by up to a third.

SABIC, based in Saudi Arabia , said it will permanently close one of its two crackers in Geleen, the Netherlands. The company has hired Lazard and Goldman Sachs to explore options for its European petrochemicals business.

Outside Europe, Japan’s Eneos plans to permanently shut down one of its ethylene crackers at the Kawasaki site by 2027 and gradually close lubricant and petroleum production at its Yokohama site by 2028.