Chemicals: Weekly: Iran Implications – Week Twelve

Research evidence excerpt

Chemicals: Weekly: Iran Implications – Week Twelve

The buyer strike is resonating in

softer markets, with May PP price in Europe settling up lower than monomer, indicating CRU: CRU Group

margin compression. This is happening globally though. CMA notes that US PE export

FOB: Free on Boardprices are now -16cpp off the April highs, 2x the pullback seen in spot markets, as global

prices soften and US moves lower to compete with exported product from China. ICIS: Independent Commodity

Urea fertilizer continues to soften, but not out of woods Intelligence Services

Urea continues to pull back as demand slows seasonally (Middle East FOB at $650-680 from Kmt: thousand metric tonnes

$700-770/mt last week). We hosted a market call with CRU (see our report: Fertiliser expert

call takeaways as of 22 May 2026) who believes China will resume exports of Urea shortly Lb: Pound

(June) and is expecting ~6mn tonnes before the window closes again by year-end. This could

MDI: Methylene diphenyl

pressure markets in the short term, though we expect another India tender to surface and

diisocyanate

absorb volumes. To date, CRU believes the market has lost 2.9mn tonnes of Middle East

production, 1.1mn tonnes of urea stranded behind the SOH, and 1.4mn tonnes of gas import Mt: Metric tonne

South Asian production. Efforts are being taken to move product to western Saudi ports,

NOLA: New Orleansand SABIC is said to have just loaded a boat at Yanbu. However, even if the strait opens

quickly, CRU sees some 2H demand likely going unmet and expects prices to stay above pre- PE: Polyethylene

conflict levels through 2026.

PP: Polypropylene

Covestro announces MDI force majeure at Baytown

Last Wednesday, Covestro announced a force majeure at its 320kmt MDI facility in SOH: Strait of Hormuz

Baytown, Texas.