Karachi: Petrochemical prices have experienced a significant surge due to the ongoing conflict in the Middle East, with polyvinyl chloride (PVC) prices rising by approximately 43% since the conflict's onset. This increase is primarily attributed to a sharp rise in feedstock costs, notably ethylene, which has seen a 100% price jump, causing disruptions in the supply chain.
According to JS Global, despite the increase in PVC prices, the rise has not fully counterbalanced the spike in ethylene costs, resulting in margin compression throughout the industry. Primary margins have declined by 8% since February 26, reaching $359 per ton. The upward trend in ethylene prices is further exacerbated by a 50% rise in naphtha costs over the past month, driven largely by a 38% increase in Brent oil prices since the conflict began. Additionally, heightened sea freight and insurance expenses have contributed to the escalating costs.
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