Middle East supply cut-off: What does it mean for global PP, PE markets?
by Esra Ersöz - eersoz@chemorbis.com
Mounting uncertainty over the ability to ship cargoes out of the Middle East amidst the growing war that broke out over the weekend has pushed global polymer markets into risk-pricing mode. Iranian media’s reports that the Strait of Hormuz has been closed have rattled energy and logistics chains, while Trump said late on Tuesday that the US will escort tankers through Hormuz, and provide insurance to shipping companies.
Amid the intensifying conflict and growing uncertainty over shipments, PP and PE markets from Asia to Europe are facing a serious risk of supply disruptions as the Middle East is the world’s number 1 PP and number 2 PE supplier.
Needless to say, crude oil and natural gas prices have surged sharply. In terms of production, QatarEnergy suspended downstream production, while Indonesia’s Chandra Asri declared force majeure after feedstock shipments from the Middle East were disrupted. Although no widespread production shutdowns have been confirmed beyond these cases, sellers across the region are reassessing logistics and pricing strategies.
“The situation is extremely fluid and we are monitoring it carefully. As of now we are evaluating alternate shipping options while communicating with customers regarding potential delays,” one of the major Saudi producers said. Freight remains uncertain, with CMA CGM, Maersk and Hapag-Lloyd applying emergency surcharges of $100–150/ton. Many Middle Eastern sellers have suspended offers, and price hikes are already being reflected globally.
Against this backdrop, global PP and PE markets are reacting at different speeds depending on their vulnerability — but in the same direction.
China: PP impact is more cost-side than supply-side; PE dependence on imports from Mid-East/Iran to shake markets
As China - the world’s largest PP and PE consumer - has been adding new PP capacities, its import dependence has shrunk visibly over the past few years. 17% of overall imports came from the Middle East with the UAE taking the lead, ChemOrbis Stats Wizard suggests. Even though China is less exposed in PP than PE, the disruption of LPG and propane supplies from the region is to raise costs of propylene and propel PP prices higher in China.
In the meantime, the Middle East’s share was 34% in overall PE imports of 2025, which is much larger than PP, with UAE and Saudi competing with each other and Qatar having a minimal share of 4%.
More importantly, Iran - standalone - has been a crucial supplier of PE for China. Although its share has considerably fallen over the past few years, Iran still accounted for 8% of China’s overall PE imports, particularly in HDPE and LDPE, with more than 1 million tons in 2025, according to ChemOrbis Stats Wizard.
Considering Iran and Arab suppliers together, less than half of China’s import PE supplies are directly exposed. Accordingly, local PE markets have responded swiftly to the highly possible disruption from its main import suppliers with notable price hikes. LDPE film prices rose by up to CNY700–750/ton ($102–109/ton), whereas the increase in the local PP market was more modest at CNY100-300/ton ($14-43/ton) early in the week.
Southeast Asia: PE markets are more vulnerable
The world’s second largest PE buyer is ASEAN, according to ChemOrbis Stats Wizard, with slightly less than half of its overall PE imports coming from the Middle East. Saudi Arabia is by far the largest supplier while the UAE and Qatar follow suit with much smaller shares.
Losing such a critical supplier, Southeast Asia has therefore seen aggressive hikes of up to $50/ton for PE film grades, accompanied by widespread offer withdrawals.
Several Middle Eastern producers that initially quoted early in the week reportedly withdrew from the market shortly thereafter, reinforcing concerns over cargo availability. The declaration of force majeure by Chandra Asri has amplified concerns about feedstock and logistics bottlenecks.
In the case of PP, the dependence on the region is relatively smaller since the Middle East has less than 20% share in overall PP imports, again Saudi taking the lead, which is the same case in China. Although the lack of Middle Eastern PP supplies does not exert a pressure as big as in PE, rising propane costs in the absence of shipments from the region are set to push PP prices higher. So far this week, import markets across Southeast Asia have stayed on edge while local markets in Indonesia, Philippines and Vietnam have all risen.
India: More than 40-50% of supply comes from Mid-East
According to ChemOrbis Stats Wizard, India met nearly half of its PP imports from the UAE (30%) and Saudi Arabia (17%) in 2025, while the dependence on the Middle East was even larger at 52% in PE with the UAE (22%) and Saudi Arabia (18%) having the largest shares while Qatar and Oman also had more than 10% shares.
Accordingly, the cut-off from the Middle East has sent India local prices sharply higher. Middle Eastern PP shipments are reportedly facing delays of up to 20 days, prompting converters to pivot toward local supply.
Türkiye: Import dependence magnifies risk exposure
Türkiye is the world’s second largest PP buyer, but when it comes to Middle Eastern supplies, Türkiye is the top buyer of regional PP supply. 38% of overall PP imports came from Saudi Arabia and 5% from the UAE in 2025, according to ChemOrbis Stats Wizard.
As for PE, the Middle East formed around 31% of overall imports last year while Iran also had a 10% share. With more than 40% of its nearby supply base currently disrupted, Türkiye’s markets have opened the weekamid confusion and a delay in new import PP and PE offers.
Petkim raised LDPE prices by $60/ton, while local distributors reported hikes exceeding $50/ton for prompt homo-PP. Buyers anticipate limited spot availability, with contract volumes prioritized.
Market players are increasingly focused on supply security rather than price negotiation.
Europe: Energy shock meets import anxiety
European polyolefin markets are confronting a multi-layered risk profile. EU27 imported roughly 31% of PP and 24% of PE from the Middle East in 2025 - mainly Saudi Arabia - ChemOrbis Stats Wizard shows, underscoring its exposure.
Natural gas prices surged by nearly 74% within days, while Brent topped $85/bbl during Tuesday’s intra-trading. March ethylene and propylene contracts settled €50/ton and €35/ton higher, respectively. The narrative has shifted from weak demand to supply-security pricing.
Logistics measures — including emergency conflict surcharges and rerouting decisions — are lengthening transit times and raising freight costs. Several Middle Eastern and Asian suppliers have suspended fresh quotations.
European producers are targeting three-digit hikes, with some announcing increases of up to €200/ton. While demand remains subdued, buyers have begun exploring defensive purchases to hedge against potential shipment delays.
Amid the intensifying conflict and growing uncertainty over shipments, PP and PE markets from Asia to Europe are facing a serious risk of supply disruptions as the Middle East is the world’s number 1 PP and number 2 PE supplier.
Needless to say, crude oil and natural gas prices have surged sharply. In terms of production, QatarEnergy suspended downstream production, while Indonesia’s Chandra Asri declared force majeure after feedstock shipments from the Middle East were disrupted. Although no widespread production shutdowns have been confirmed beyond these cases, sellers across the region are reassessing logistics and pricing strategies.
“The situation is extremely fluid and we are monitoring it carefully. As of now we are evaluating alternate shipping options while communicating with customers regarding potential delays,” one of the major Saudi producers said. Freight remains uncertain, with CMA CGM, Maersk and Hapag-Lloyd applying emergency surcharges of $100–150/ton. Many Middle Eastern sellers have suspended offers, and price hikes are already being reflected globally.
Against this backdrop, global PP and PE markets are reacting at different speeds depending on their vulnerability — but in the same direction.
China: PP impact is more cost-side than supply-side; PE dependence on imports from Mid-East/Iran to shake markets
As China - the world’s largest PP and PE consumer - has been adding new PP capacities, its import dependence has shrunk visibly over the past few years. 17% of overall imports came from the Middle East with the UAE taking the lead, ChemOrbis Stats Wizard suggests. Even though China is less exposed in PP than PE, the disruption of LPG and propane supplies from the region is to raise costs of propylene and propel PP prices higher in China.
In the meantime, the Middle East’s share was 34% in overall PE imports of 2025, which is much larger than PP, with UAE and Saudi competing with each other and Qatar having a minimal share of 4%.
More importantly, Iran - standalone - has been a crucial supplier of PE for China. Although its share has considerably fallen over the past few years, Iran still accounted for 8% of China’s overall PE imports, particularly in HDPE and LDPE, with more than 1 million tons in 2025, according to ChemOrbis Stats Wizard.
Considering Iran and Arab suppliers together, less than half of China’s import PE supplies are directly exposed. Accordingly, local PE markets have responded swiftly to the highly possible disruption from its main import suppliers with notable price hikes. LDPE film prices rose by up to CNY700–750/ton ($102–109/ton), whereas the increase in the local PP market was more modest at CNY100-300/ton ($14-43/ton) early in the week.
Southeast Asia: PE markets are more vulnerable
The world’s second largest PE buyer is ASEAN, according to ChemOrbis Stats Wizard, with slightly less than half of its overall PE imports coming from the Middle East. Saudi Arabia is by far the largest supplier while the UAE and Qatar follow suit with much smaller shares.
Losing such a critical supplier, Southeast Asia has therefore seen aggressive hikes of up to $50/ton for PE film grades, accompanied by widespread offer withdrawals.
Several Middle Eastern producers that initially quoted early in the week reportedly withdrew from the market shortly thereafter, reinforcing concerns over cargo availability. The declaration of force majeure by Chandra Asri has amplified concerns about feedstock and logistics bottlenecks.
In the case of PP, the dependence on the region is relatively smaller since the Middle East has less than 20% share in overall PP imports, again Saudi taking the lead, which is the same case in China. Although the lack of Middle Eastern PP supplies does not exert a pressure as big as in PE, rising propane costs in the absence of shipments from the region are set to push PP prices higher. So far this week, import markets across Southeast Asia have stayed on edge while local markets in Indonesia, Philippines and Vietnam have all risen.
India: More than 40-50% of supply comes from Mid-East
According to ChemOrbis Stats Wizard, India met nearly half of its PP imports from the UAE (30%) and Saudi Arabia (17%) in 2025, while the dependence on the Middle East was even larger at 52% in PE with the UAE (22%) and Saudi Arabia (18%) having the largest shares while Qatar and Oman also had more than 10% shares.
Accordingly, the cut-off from the Middle East has sent India local prices sharply higher. Middle Eastern PP shipments are reportedly facing delays of up to 20 days, prompting converters to pivot toward local supply.
Türkiye: Import dependence magnifies risk exposure
Türkiye is the world’s second largest PP buyer, but when it comes to Middle Eastern supplies, Türkiye is the top buyer of regional PP supply. 38% of overall PP imports came from Saudi Arabia and 5% from the UAE in 2025, according to ChemOrbis Stats Wizard.
As for PE, the Middle East formed around 31% of overall imports last year while Iran also had a 10% share. With more than 40% of its nearby supply base currently disrupted, Türkiye’s markets have opened the weekamid confusion and a delay in new import PP and PE offers.
Petkim raised LDPE prices by $60/ton, while local distributors reported hikes exceeding $50/ton for prompt homo-PP. Buyers anticipate limited spot availability, with contract volumes prioritized.
Market players are increasingly focused on supply security rather than price negotiation.
Europe: Energy shock meets import anxiety
European polyolefin markets are confronting a multi-layered risk profile. EU27 imported roughly 31% of PP and 24% of PE from the Middle East in 2025 - mainly Saudi Arabia - ChemOrbis Stats Wizard shows, underscoring its exposure.
Natural gas prices surged by nearly 74% within days, while Brent topped $85/bbl during Tuesday’s intra-trading. March ethylene and propylene contracts settled €50/ton and €35/ton higher, respectively. The narrative has shifted from weak demand to supply-security pricing.
Logistics measures — including emergency conflict surcharges and rerouting decisions — are lengthening transit times and raising freight costs. Several Middle Eastern and Asian suppliers have suspended fresh quotations.
European producers are targeting three-digit hikes, with some announcing increases of up to €200/ton. While demand remains subdued, buyers have begun exploring defensive purchases to hedge against potential shipment delays.
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