Dow Inc., one of the world’s largest producers of petrochemicals, expects supply disruptions tied to the war in Iran to persist throughout the remainder of 2026, according to Chief Executive Officer Jim Fitterling.
“The conflict in the Middle East has created constraints that are clearly evident in the near term — this includes supply chain disruption for an extended period of time,” Fitterling said on a call with analysts on Thursday. “We also anticipate impact to future investments, including potential delays or cancellations of planned industry capacity additions, as well as increased pressure for capacity rationalization.”
The global plastics market has been thrown into upheaval. Disruptions tied to the war have tightened global supply and reshaped flows of petrochemicals like polyethylene, which are used in everyday products ranging from packaging and food containers to medical supplies and automotive parts. Global prices have jumped as producers in Asia have been cut off from ingredient supplies from the Middle East that feed their manufacturing lines. Meanwhile, demand for US exports is surging.
With traffic through the Strait of Hormuz ground to a halt, roughly a fifth of the world’s oil trade has been disrupted. That means about half of global ethylene and polyethylene supplies are either offline or directly impacted, Dow’s Chief Operating Officer Karen S. Carter said on the company’s call Thursday.
“These are unparalleled numbers,” she added, citing infrastructure damage, feedstock shortages and ongoing logistical disruptions.
Even if the conflict ends soon, it may take some time for supply disurptions to unwind. In March, Fitterling said petrochemical shipments would lag even after key shipping routes reopen, as oil, natural gas and fertilizer cargoes take priority.
Meanwhile, consumption remains robust. On Thursday, Dow reported stronger polyethylene volumes across all regions in the first quarter, supported by firm global demand for packaging and specialty plastics. Carter said that the resilient packaging demand is now supporting near-term pricing potential.
Written by: Christopher Charleston @Bloomberg
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