According to the latest assessments from Formosa Plastics Group and Formosa Chemicals (reported April 13, 2026), even if the US-Iran war ends, energy and petrochemical feedstock shortages will remain tight and are likely to persist until the end of 2026. This will severely affect global market supply but could benefit Asian petrochemical recovery earlier.
Key Recent Developments:
• Israel struck Iran’s largest petrochemical industrial park on April 4 (annual capacity 72 million tonnes), causing complete shutdown; Bahrain refinery and UAE petrochemical plants also damaged by attacks. The IEA reports around 72 oil/gas fields, refineries, and natural gas facilities in the Middle East affected, with restarts requiring significant time and capital.
• Continued closure of the Strait of Hormuz disrupts ~20-25% of global oil and petrochemical shipping, leading to shortages of upstream feedstocks like ethylene and propylene, driving up prices of PE, PP, PVC, and other resins.
• Downstream impacts ongoing: shortages and price hikes in plastic bags, packaging, synthetic fibers, construction materials, and food packaging. Taiwan and broader Asia seeing panic buying, rationing, or limited availability, raising costs for daily goods and manufacturing.
• Formosa Plastics notes the deep damage to Middle East energy infrastructure will slow recovery; Formosa Chemicals GM states Persian Gulf petrochemical operations are impaired to varying degrees, with feedstock shortages expected to continue through the year.
In summary, plastic and petrochemical prices remain under upward pressure in the near term, with potential for long-term supply chain reconfiguration; Asian players may gain relative advantage from earlier recovery.