From Oversupply to Crisis: How Middle East conflict could flip Asia olefins market narrative

The US-Iran conflict has fundamentally disrupted Asia's petrochemical supply chains. As of 18 March, the war remains ongoing with the Strait of Hormuz blockade entering its third week. Whilst a swift reopening could enable rapid price normalisation, the continued blockade is driving sustained volatility and supply constraints that could persist for weeks or months, with profound implications for Asia's petrochemical-dependent economies. Asia faces acute exposure to Middle Eastern supply disruptions, though vulnerability varies significantly by region. Feedstock shortages have triggered widespread force majeure declarations and operating rate cuts across Asian olefins industry. This insight assesses the impact of a Strait of Hormuz closure on the Asian olefins sector under various reopening scenarios, and provides a market recovery outlook for the post-disruption period.