# Asia’s Plastic Crisis: How the Iran Oil Shock Disrupts Regional Supply Chains

- Link: https://www.thailand-business-news.com/markets/306667-asias-plastic-crisis-how-the-iran-oil-shock-disrupts-regional-supply-chains
- Published: 2026-05-13T04:47:00+07:00
- Author: J. Allan

Asia is in the grip of a deepening plastics emergency as the Iran oil shock chokes
off supplies of a critical petrochemical feedstock, sending packaging prices soaring
and raising alarm across food, medical, and consumer goods industries from Indonesia
to Japan.

## Key takeaways

 * Asia imports around 70% of its naphtha from the Middle East, and the Strait of
   Hormuz closure has nearly doubled prices, sending plastic resin costs up as much
   as 59% and threatening production shutdowns across the region.
 * The shortage is hitting everyday goods and medical supplies simultaneously, with
   food packaging, beverage containers, and hospital plastics such as syringes and
   IV bags all affected across Indonesia, Japan, South Korea, and beyond.
 * Governments have responded with emergency tariff suspensions and export bans 
   on naphtha, **while recycled plastic prices have quadrupled from $400 to $1,600
   per ton** as manufacturers scramble for alternatives.

**At the heart of the crisis is naphtha**, a petroleum derivative and essential 
building block for the polymers that underpin virtually all modern plastic packaging.

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The closure of the Strait of Hormuz following U.S. and Israeli airstrikes on Iran
in late February has dramatically curtailed the region’s access to that raw material.

The price of naphtha in Asia has nearly doubled since the conflict began, while 
prices for plastic resins have climbed as much as 59% to record highs.

On the ground in Jakarta, the crisis is already palpable. At Toko Durga Plastik,
a packaging retailer in the Indonesian capital, daily sales have fallen by almost
half over the past month.

A sign at the entrance warns customers of “skyrocketing” prices. “Sourcing supplies
is impossible because the stock is limited,” said Arif, a worker at the shop. Indonesia
imports virtually all of its naphtha, the overwhelming majority of which previously
arrived from the Middle East. Suppliers have warned plastics producers they may 
have to suspend operations entirely.

## From Food Stalls to Hospital Wards

The disruption is not confined to Indonesia. Asia imports around 70% of its naphtha
from the Middle East, and the shockwaves are being felt across the region.

In Japan, fears are mounting that patients with chronic kidney failure will struggle
to access the plastic medical tubes used in hemodialysis. In South Korea, health
regulators launched a nationwide probe into hoarding of syringes, needles and gloves,
and Seoul imposed an export ban on naphtha to protect domestic supply.

**Taiwan saw plastic goods prices surge as much as 40%, while Malaysia’s Farm Fresh
dairy brand said a shortage of PET resin caused its milk cartons to vanish **from
supermarket shelves. In India, prices for plastic bottle caps have quadrupled since
the war started.

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> “This spills into everything very, very quickly: beer, noodles, chips, toys, cosmetics,”
> said Dan Martin, co-head of business intelligence at advisory firm Dezan Shira
> and Associates.

Experts warn the burden will fall hardest on smaller enterprises. “Large firms typically
have access to tools such as hedging, long-term contracts, and inventory buffers.
Most smaller manufacturers do not,” said Chen Ping-Kuo, a professor of industrial
engineering at Japan’s Ritsumeikan Asia Pacific University. He cautioned that the
disruption will “move quickly through supply chains,” given Asia’s deep dependence
on plastic across virtually every industry.

## No Easy Exit

Governments across the region are responding with emergency tariff suspensions and
efforts to diversify supply sources. At the same time, manufacturers of paper, bamboo
and recycled packaging are reporting unexpected windfalls as companies scramble 
for alternatives. The price of recycled plastics has jumped from around $400 per
ton before the crisis to $1,600 per ton today.

The IMF has warned that for affected economies, “all roads lead to higher prices
and slower growth.” With no resolution to the Strait of Hormuz closure in sight,
analysts warn the worst may be yet to come.