Introduction

Asian petrochemical markets are entering September under renewed cost pressure as crude oil prices continue to rise and regional supply remains constrained. According to the latest ICIS market report, higher feedstock costs, tighter operating rates and cautious restocking activities are shaping the chemical market across Asia.

For manufacturers of epoxy resins, curing agents, coatings and adhesives, these upstream changes directly influence raw-material costs, availability and procurement planning throughout the supply chain.

Key Market Highlights

Crude oil lifts petrochemical prices

Brent crude has climbed above US$97/barrel, pushing naphtha prices higher and increasing production costs for Asian petrochemical producers. As a result, many suppliers have raised offer prices to offset feedstock inflation.

Supply remains tight

Although demand recovery is still uneven, reduced operating rates at some petrochemical plants have limited the availability of certain chemical intermediates, creating a supply-driven pricing environment.

Restocking is expected—but selectively

Buyers in China are preparing inventories ahead of the October National Day holiday, while Indian demand may improve after the monsoon season. However, this is expected to be tactical restocking rather than a broad market rebound.

What It Means for the Epoxy Industry

Epoxy materials sit directly downstream of naphtha-based petrochemicals, meaning fluctuations in crude oil and feedstock prices quickly translate into cost pressure across the epoxy value chain.

The current market presents three important implications:

• Higher raw-material costs: Rising naphtha prices continue to increase the production cost of epoxy-related intermediates.

• Greater supply uncertainty: Lower cracker operating rates may tighten availability of key upstream chemicals even when downstream demand remains moderate.

• More cautious procurement: Most coating and adhesive manufacturers are likely to maintain lean inventories and purchase according to short-term production needs.

Outlook for Q4 2026

The Asian epoxy raw-material market is expected to remain influenced by two key factors: crude-linked feedstock volatility and uneven downstream demand. While seasonal restocking may support short-term trading activity, market participants are generally prioritizing flexible purchasing strategies over aggressive inventory expansion.

For epoxy manufacturers and procurement teams, closely monitoring naphtha prices, plant operating rates and regional supply conditions will be essential in managing cost and delivery risks during the remainder of 2026.