Zhenghao New Materials

The International Energy Agency (IEA) stated that the Iran war has severely disrupted Middle East oil production, leading to a global oil supply shortage that will fail to meet total demand this year. The war is also pressuring consumption, with soaring oil prices causing demand contraction and slower economic growth. In its monthly Oil Market Report, the IEA noted that due to continued restrictions on tanker shipping in the Strait of Hormuz, cumulative supply losses from Gulf oil-producing countries have exceeded 1 billion barrels, with over 14 million barrels per day of crude oil production currently halted, constituting an unprecedented supply shock. The agency’s baseline forecast is that shipping in the Strait of Hormuz will gradually recover starting from the third quarter, with global oil supply falling 1.78 million barrels per day short of total demand this year— a sharp reversal from last month’s forecast of a 410,000-barrel surplus and December’s projection of nearly 4 million barrels. The IEA estimates the war will reduce annual supply by about 3.9 million barrels per day in 2026, up from the previous estimate of 1.5 million barrels. Demand this year is now projected to drop by 420,000 barrels per day, compared to the prior forecast of an 80,000-barrel decline. This supply-demand imbalance directly impacts the chemical additives industry: as a downstream sector of oil, prices of petroleum-based chemical additive raw materials such as stearic acid, stearates, paraffin, and dispersants have remained high alongside oil prices. Some varieties have seen significant price increases, directly raising production costs of additives for heavy calcium carbonate modification, plastics, coatings and other fields, further squeezing industry profit margins. Meanwhile, restricted shipping in the Strait of Hormuz has hindered raw material imports and caused spot shortages, increasing pressure on additive enterprises to replenish inventories and lengthening delivery cycles. Coupled with shrinking downstream demand due to slower economic growth, the industry is accelerating differentiation, with cost-effective, environmentally friendly and bio-based alternative additives becoming key for enterprises to overcome difficulties, forcing the industry to accelerate formula optimization and raw material substitution upgrades.