ICIS data shows Qatar, UAE LNG production in line with normal range Growing focus on Iran’s Hormuz Strait closure rhetoric Over 80% of Qatari LNG goes to Asia but highly relevant for Europe LONDON (ICIS)–LNG production from Qatar and the UAE – the two countries that sit the other side of the Strait of Hormuz from global buyers – continues as normal, according to ICIS data. Disruption to shipping signals is making the accurate tracking of LNG vessels harder, and more ballast Qatari vessels are waiting east of Hormuz than normal before going to Ras Laffan to load. ICIS data on Monday 23 June showed that 43 vessels had loaded from Ras Laffan in the last 15 days, unchanged from the same period last year. This is down by one from the previous 15-day period, but this is not an unusual deviation given the scale of 77.4mtpa production. A total of four cargoes loaded from the UAE’s Das Island over the past 15 days, up by one from last year, down by one from the previous 15 days, according to ICIS data. ICIS analysts have observed a number of vessels near Qatar registering false positions via their AIS signal data. But ICIS identified the laden 138,000cbm Disha as having crossed Hormuz east on Sunday 22 June, as well as the 152,000cbm Al Areesh and the 174,000cbm Al Sakhamah. The 138,000cbm Raahi appears to have crossed west in ballast on 23 June. KEY LNG TRADE FLOWS Global gas and LNG spot prices have moved up since early June due to growing security concerns in the Middle East, and are back to the highest levels since February. While the TTF now reacts immediately to major geo-political news given the depth of market participants, liquidity, and Europe’s dependency on LNG imports, East Asian spot LNG pricing remains less liquid, and highly influenced by the European market. That said, the ICIS East Asia Index remains at a volatile premium to the TTF, despite limited new LNG demand signals from Asian buyers. Since the start of 2024, 82% of Qatari LNG has gone to Asian markets, according to ICIS data, with Europe now accounting for a much smaller share. Rising US LNG production has stepped in to dominate Europe’s LNG supply. The UK, for example, now imports much more from the US than it does from Qatar. Major LNG buyers continue to analyse potential risks to current supply from the Middle East situation, and are well aware of the impact even a small reduction in Qatari deliveries would have. While this would hit Asian buyers most directly, it would also impact European markets if higher Asian spot prices pulled US LNG away from Europe. BULLISH PRICES An Asian price premium of up to $0.50/MMBtu to the TTF – typical of the last month – would likely mean sufficient US LNG flows to both Europe and Asia to cover demand and reflects a reasonably well-balanced market. In the event of a cut in supply to Asia, the EAX would rise, taking the TTF with it given Europe’s dependency on LNG. The Asian premium to TTF would likely need to rise to at least $2/MMBtu to pull much larger volumes of US LNG away from Europe. Further TTF price rises would filter through across European energy markets. In Asia, most LNG is still sold on an oil price link which is currently well below spot prices – although oil prices would naturally also be impacted by Hormuz disruption. It is unlikely, however, that outright gas and LNG prices would substantially deviate between the two regions as both would compete for cargoes. Higher spot LNG prices would also dent demand from many Asian buyers. Any extended closure of Hormuz appears highly unlikely given likely pressure that would come from major economic and military powers against Iran. But even short-term disruption could lift LNG and gas prices and lead to significant scrambling from sellers and buyers needing to use all available optimization and risk management tools at their disposal. Alex Froley contributed to this story

LONDON (ICIS)–Click here to see the latest blog post on Chemicals & The Economy by Paul Hodges, which suggests it would be prudent to plan for further escalation of the trade and military wars in H2. Editor’s note: This blog post is an opinion piece. The views expressed are those of the author and do not necessarily represent those of ICIS. Paul Hodges is the chairman of consultants New Normal Consulting.

LONDON (ICIS)–Eurozone business activity rose slightly in June from the previous month with growth centred on manufacturing, where production increased for the fourth successive month. The eurozone composite purchasing managers’ index (PMI) was unchanged from May at 50.2 points, while the business activity PMI rose to a two-month high at 50.0 points, according to flash data from S&P Global and the Hamburg Commercial Bank (HCOB). A reading above 50 indicates expansion and below 50 contraction. “Overall growth was again centered on the manufacturing sector,” S&P said in a statement. “That said, the rate of expansion in June was slight, having eased to a three-month low.” The group’s manufacturing output index fell to 51 points in June from 51.5 in May, while the manufacturing index was unchanged at 49.4 points. “The eurozone economy is struggling to gain momentum. For six months now, growth has been minimal, with activity in the service sector stagnating and manufacturing output rising only moderately,” said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank.

LONDON (ICIS)–Here are some of the top stories from ICIS Europe for the week ended 20 June. Shipping, crude hikes eyed by Europe PE, PP as Israel-Iran conflict escalatesShipping and crude oil costs are the biggest concerns for European polyethylene (PE) and polypropylene (PP) players in the wake of the latest Israel-Iran attacks which saw oil benchmarks rocket 7% on 13 June. Brent crude was trading above $75/barrel on Monday. Turkey PE spot prices dipping on slow restart post-Eid, logistics in Persian Gulf monitoredTurkish polyethylene (PE) prices were largely stable to soft last week, despite a pick up in momentum for the low density PE (LDPE) grade, as food and beverage packaging production gears up for the peak tourist season which starts next month. Westlake Epoxy to close its entire Pernis operationsWestlake Epoxy plans to close its entire Pernis site, including liquid epoxy resins, bisphenol A (BPA), allyl chloride (AC) and epichlorohydrin (ECH) operations in 2025, according to a company statement on 17 June. INSIGHT: Israel-Iran conflict forces chemicals closures, tightens regional supplyThe Israel-Iran conflict is already impacting important parts of Iran’s chemical sector as the country’s entire monoethylene glycol (MEG), urea and ammonia capacities have been shut down along with most methanol plants, with repercussions for global markets. INSIGHT: High UK PE production costs drive prices down and turmoil upThe UK remains the lowest price region across Europe for polyethylene (PE) and this appears to highlight struggles affecting many players in the country. Ammonia offers to rise as supply tightens on Israel-Iran conflictAmmonia supply is expected to tighten following the escalation of the conflict between Iran and Israel this week.

SINGAPORE (ICIS)–New ICIS-linked Asia methanol derivatives contracts will start trading on the Singapore Exchange (SGX) on 14 July. The new futures/swap contracts on a cost-and-freight (CFR) basis will be for the key regional trading hubs of China (specific origins) and southeast Asia, SGX said. SGX will list 24 consecutive contract months starting with the July 2025 contract. The minimum lot size for the CFR China (specific origins) and CFR southeast Asia contracts will be 100 tonnes for the futures and 500 tonnes for the swap, SGX said. The final settlement price (FSP) for the contracts will be the arithmetic average of all weekly ICIS index assessments in the expiring contract month for the relevant underlying product, SGX said in a statement on 20 June. “The ICIS-linked contracts will provide investors with more comprehensive risk management solutions particularly at a time of greater market volatility,” said Peh Soo Hwee, ICIS managing editor for Asia and the Middle East. Methanol is a vital building block chemical with applications ranging from formaldehyde and acetic acid production to emerging uses in marine fuels and power generation.

SINGAPORE (ICIS)–Asia’s petrochemical shares dipped while oil prices rose on Monday, after the US bombed Iran’s nuclear facilities, raising fears of retaliation from Tehran which could disrupt global oil supplies. Markets’ reactions contained, so far Iran parliament approves closure of Strait of Hormuz Oil prices may hit $100-150/barrel in worst-case scenario – DBS Bank At 03:20 GMT, Japanese Asahi Kasei was down by 0.62%, while Mitsui Chemicals declined by 1.62% in Tokyo; South Korean LG Chem was down by 4.61% in Seoul; and Chinese oil major PetroChina slipped by 0.3% in Hong Kong. Japan’s benchmark Nikkei 225 Index was down by 0.59% at 38,175.63; South Korea’s KOSPI Composite index fell by 0.64% to 3,002.51; and Hong Kong’s Hang Seng index was down by 0.09% at 23,510.02. With investors awaiting Iran’s potential retaliation, early market reactions were contained, with Brent rising by around 1.5% at 03:42 GMT, well off its initial peaks. Product (at 03:42 GMT) in $/barrel Latest Previous Change Brent August 78.16 77.01 1.15 WTI August 75.75 73.84 1.91 Both Brent and US WTI futures jumped by more than 3% earlier in the session to $81.40/bbl and $78.40/bbl, respectively, touching five-month highs before giving up some gains. Oil prices have surged since Israel struck nuclear sites in Iran on 13 June, and continuing to rise amid heightened tensions in the Middle East, with concerns centering on Iran’s possible blockage of the Strait of Hormuz, which is crucial for energy trades. Asia’s status as a significant net oil and energy importer means that most of the economies in the region such as Thailand, South Korea the Philippines and India, are vulnerable to oil price shocks. Following the US’ strikes on Iranian targets over the weekend, Iran’s Parliament voted to close the Strait of Hormuz, but some shipping majors’ vessels continue to sail through the crucial energy trade lane amid growing security risks. According to Iran Press TV, after the parliament vote, the final decision by Iran on Hormuz’s closure will be left to the country’s Supreme National Security Council. US President Donald Trump on 22 June announced on social media that US forces had conducted “very successful” strikes on Iranian nuclear facilities at Fordow, Natanz, and Isfahan. Trump also warned Iran against retaliation, mentioning there are more targets left for the US to target if Iran does so. “There will be considerable uncertainty as to what happens next, leading to high volatility in oil prices in coming days and weeks. As to what next, all depends on how Iran responds,” Singapore’s DBS Bank said in a note on Monday. DBS projects that under a “worst-case scenario”, near-term oil prices could surge up to $100-150/barrel if blockage of Strait of Hormuz materializes. The Strait of Hormuz is a vital passage for around 20-25% of global oil trade and 20-30% of liquefied natural gas (LNG) supplies. With continued escalation in the conflict, tighter sanctions on Iranian oil exports are possible, which could reduce global oil supplies by up to 1.5 million barrels per day and raise fears of market disruption, it said. For now, it remains to be seen how Iran will respond to the US strikes. Iran’s foreign minister said on 22 June that the Islamic Republic reserves “all options” to defend its sovereignty. “Moving forward, the degree of potential upside risks to oil prices is dependent on the extent of disruptions to global oil and energy productions and supplies,” Japan-based analysts at MUFG Research said in a note. “While it is possible for shipments to be rerouted through alternative pipelines, the extent is overall limited in a scenario of full disruption of the Strait of Hormuz,” it said. MUFG noted that elevated global oil inventories, available spare capacity by OPEC and its allies (OPEC+), and US shale production could all provide some buffer. “However, a full closure of the Hormuz Strait would still impact on the accessibility of a major part of this spare production capacity concentrated in the Persian Gulf.” Focus article by Nurluqman Suratman Additional reporting by Jonathan Yee Visit the ICIS Topic Page: Israel-Iran conflict: impact on chemical and energy markets Thumbnail image: Tehran, Iran on 16 June 2025 (ABEDIN TAHERKENAREH/EPA-EFE/Shutterstock)

SINGAPORE (ICIS)–Oil prices surged in early Asian trade on Monday, with Brent crude briefly crossing $81/barrel before easing, after the US bombed Iran’s nuclear facilities, raising fears of retaliation from Tehran via striking energy infrastructure in the Middle East or by blocking the Strait of Hormuz. Crude prices in $/barrel Product Latest (as of 01:27 GMT) Previous Change Brent August 78.95 77.01 1.94 WTI August 75.75 73.84 1.91 Both Brent and US WTI futures jumped by more than 3% earlier in the session to $81.40/bbl and $78.40/bbl, respectively, touching five-month highs before giving up some gains. US President Donald Trump on 22 June announced on social media that the US has bombed nuclear sites in Iran in a “very successful military operation”. It remains to be seen how Iran will respond to the unprecedented US strikes. Iran’s foreign minister said on 22 June that the Islamic Republic reserves “all options” to defend its sovereignty. Investors’ focus is now on the Strait of Hormuz, a vital passage for around 20-25% of global oil trade and 20-30% of liquefied natural gas (LNG) supplies. “Moving forward, the degree of potential upside risks to oil prices is dependent on the extent of disruptions to global oil and energy productions and supplies,” Japan-based analysts at MUFG Research said in a note. Thumbnail image: Protest against US President Donald Trump’s decision to bomb Iran, Washington, US – 22 June 2025 (JIM LO SCALZO/EPA-EFE/Shutterstock)

SINGAPORE (ICIS)–Here are the top stories from ICIS News Asia and the Middle East for the week ended 20 June 2025. Japan’s core inflation rises to two-year high; rate hike pressure persists By Nurluqman Suratman 20-Jun-25 11:58 SINGAPORE (ICIS)–Japan’s core inflation rate climbed to 3.7% in May 2025, marking its highest level since January 2023. This has kept pressure on the Bank of Japan (BOJ) to resume interest rate hikes, official data showed on 20 June. Global PVC market braces for glut as protectionism rises and demand falters By Nurluqman Suratman 19-Jun-25 23:06 SINGAPORE (ICIS)–The global polyvinyl chloride (PVC) market is poised for a significant supply surplus, primarily driven by a surge in Chinese exports and an increasingly protectionist international trade environment, an industry analyst said on Thursday. China acetic acid prices soar on Middle East conflict, plants under review By Jady Ma 19-Jun-25 21:47 SINGAPORE (ICIS)–Methanol prices in China have surged this week, pushing up acetic acid prices in many regions across the country. However, any further upside will be subject to supply. Middle East tonnage tightens amid Israel-Iran conflict By Hwee Hwee Tan 19-Jun-25 13:36 SINGAPORE (ICIS)–Chemical freight is firming up in the Middle East on increasing maritime insurance and bunker costs, as regional tonnage supply tightens amid an ongoing military conflict between Israel and Iran. Japan May chemical exports fall 6%; overall shipments hit by US tariffs By Nurluqman Suratman 18-Jun-25 12:04 SINGAPORE (ICIS)–Japan’s chemical exports in May declined by 5.6% year on year to yen (Y) 928 billion ($6.4 billion), contributing to the first contraction in its overall shipments abroad in eight months which raises the risk of a technical recession in the world’s fourth-biggest economy. INSIGHT: China MEG import supply to tighten further on escalating Iran-Israel conflict By Cindy Qiu 17-Jun-25 11:00 SINGAPORE (ICIS)–On 13 June, Israel launched large-scale airstrikes on multiple regions in Iran. On the same day, Iran began multiple rounds of missile and drone attacks on Israel, sharply escalating the conflict between the two countries. Iran methanol plants shut as conflict with Israel continues By Damini Dabholkar 17-Jun-25 17:06 SINGAPORE (ICIS)–Iran’s methanol industry is facing significant disruption due to the conflict with Israel, leading to the shutdown of several key production facilities. Asia nylon supply tightened by Shenma blast, lifting price outlook By Isaac Tan 16-Jun-25 11:16 SINGAPORE (ICIS)–The nylon market in Asia is poised for near-term price support following an explosion at Shenma Group’s plant in Pingdingshan, which has led to tighter supply and triggered safety checks across the sector.

SAO PAULO (ICIS)–Mexico’s Port of Manzanillo is gradually recovering cargo handling capacity, which currently stands at around 60% of normal levels, according to the port’s authority, after weeks of operational disruptions caused by customs delays. The crisis, however, continues to impact costs and operations for most manufacturing companies, including chemicals, with analysts now expecting the backlog to be cleared in the next four weeks – an improvement from May’s pessimistic forecasts which envisaged the crisis lasting until September. The Pacific coast port, one of Mexico’s largest and the main entry point for imports from China and wider Asia, has struggled since mid-May due to personnel shortages at customs after authorities implemented some redundancies. That was followed, first, by workers’ protests, which caused internal blockades of the port, further creating significant delays in cargo processing, as well as strike action. All in all, Manzanillo was practically idle for several days in May. According to the Mexican Alliance of Transport Organizations, extended 24-hour customs operations and restructured truck appointments have enabled land freight transport to recover to 60% of usual pace. The Manzanillo Port Community implemented staggered entry times for import units, prioritising operations between 03:00 and 12:00 at the Specialized Container Terminal. Contecon Manzanillo, the operator of the facilities – a subsidiary of Manila-headquartered International Container Terminal Services (ICTSI Group) – coordinated with Mexico’s National Customs Agency to extend operations through ICTSI Group continuous shifts from 13-15 June, aimed at reducing wait times and preventing further container accumulation. The container backlog has forced some ships planning to dock at Manzanillo to divert to alternative ports including Lazaro Cardenas, further increasing costs, and transportation companies have said they are facing mounting expenses for diesel, travel, food, and lodging due to delays. Port operations are expected to return to normal within four weeks, requiring patience from importers, transporters and the entire logistics chain. PAMA HITS CHEMICALS HARDERFor chemicals players, the problems regarding delayed cargo and lack of personnel at customs points across Mexico, are being compounded by newly established customs regulations, which aimed to improve the clearance of goods at customs as well as the seizing of illegal goods. In practice, the so-called PAMA regulation has added costs in the form of bureaucracy, and in the case of chemicals, sharply slowed down the entry of imports into Mexico. PAMA is becoming the first thing sources mention when asked about logistics. “Things have not improved much since mid-May, at least as we see them. In fact, for us the situation is still terrible, and we are literally hemorrhaging money in payments to shipping companies, due to the delays, and to the port’s facilities, due to the materials we have been forced to store there,” said a source at a Mexican chemicals distributor this week. PAMA entails that companies now must give more information about the load. For example, if the declared weight of the load deviates in the slightest from the weight showed on the customs scale, this can be a reason to send the load back to square one, with a fine potentially also imposed, according to the source in chemicals distribution. In mid-May, the distribution source said they had had a container held for 45 days up to that point, because it could not be released due to a mismatch in the weight: it was missing two decimal places. After correcting the error and paying several fines because of it, the container could finally be released earlier in June. “We are finding PAMA to be a serious problem – many of our loads get stuck because of regulation-related issues, and our logistics are becoming a burdensome and time-consuming process. Moreover, the fines are disproportionate, ranging from 70% to 100% of the value of the merchandise,” they stated. Another source, this on the production side, concurred that Manzanillo’s crisis and delays have been a blow for chemicals companies, but also placed more importance on PAMA and its compliance than the current crisis at the port, which will sooner or later subside. “We were used to see many PAMA proceedings in rail or road transport, but now the authorities are extending that firm hand to the ports as well. And, because of the nature of chemicals, the authorities at times try to go deeper than their knowledge would allow them, making the process even more tedious,” said the producing source. “I am referring here to imports of products such as PE [polyethylene] and, more specifically, HDPE [high density polyethylene]. I am hearing from many players that several HDPE loads were subject to PAMA proceedings because of the big difference in prices [sold overseas and sold domestically], so the government argues imports are being made at lower prices – in other words, considering the load as dumping.” The source went on to say that because the authorities “do not know the market well” the ensuing investigations can in some case take months to be resolved, adding that PAMA rules – which are here to stay, unlike the Manzanillo port crisis – are becoming for the chemicals industry a considerable negative factor when importing into Mexico. Mexico’s chemicals trade group ANIQ and its peer for the plastics sector Anipac had not responded to a request for comment at the time of writing. According to importers, who are already having to endure sharply higher logistical costs due to the crisis – between 20% and 30% – the additional burden of the strict enforcement of PAMA regulations has also added to the financial woes, as the bureaucracy implied required more human resources than with the previous regulation. Mexican law firm Moreno Valdes explained in a note to clients that while most of the contingencies contemplated in PAMA would be precautionary measures and would not necessarily end in any fine, just the fact that authorities are stopping many more loads to analyze further adds delays to the already large delays. “Importers should understand that when the customs authority notifies a PAMA [proceeding], it means that this procedure involves the seizure of the goods and even the truck transportation. It is a precautionary measure, allowing the authority to obtain a guarantee against a possible breach of obligations by the importer,” said the law firm. “In other words, the merchandise will remain in Customs until the situation is clarified for the authority. There are many reasons why the authority usually initiates a PAMA. It may be that the cargo was not entered the country through the authorized place, or that it had prohibited merchandise, or because the importer is not accrediting the specific regulations that the merchandise must comply with when entering the country, among others.” Front page picture: Manzanillo’s port (Source: Port operator Contecon Manzanillo) Focus article by Jonathan Lopez Additional reporting by Bruno Menini