Tensions in the Middle East and persistently high international crude oil prices are driving a rare, collective price revaluation across the chemical market. Unlike previous cycles driven primarily by demand, the current price surge in the polyurethane chain is characterized by the significant convergence and amplification of multiple driving factors. This is not a simple cost pass-through but a systemic restructuring of the entire industrial chain's value system following simultaneous tightening on the supply, cost, and policy fronts.
Price Data: Broad-based gains exceed expectations
According to PUdaily statistics, since January 2026, cumulative market price increases for Polymeric MDI and Monomeric MDI have approached 40%, with no significant signs of retreat yet. Over the past six months, mainstream products including TDI, flexible foam Polyether Polyols, and TPU have also seen gains exceeding 20%, indicating a broad-based upward trend across the polyurethane sector.
The scope of price increases extends even wider across the upstream and downstream chain. CASE Polyether Polyols have led with nearly 30% cumulative gains. Polyester polyols, spandex, cyclopentane blowing agents, and Polymer Polyols (POP) have all risen by over 26%. Flexible foam silicone oils, polyurethane catalysts, CPU, and polyurethane resins have also seen increases of around 22%. Virtually no segment of the polyurethane industrial ecosystem has been spared.
Beyond Oil: A multi-driver analysis of the current rally
A common market perception is that chemical price increases are merely a pass-through result of rising crude oil prices. However, the collective price hike in the polyurethane chain is driven by a far more complex logic than the simple 'oil price rise → cost transfer' chain.
1. Cost Side: Dual pressure from crude oil and natural gas
Crude oil prices have risen by approximately 40% over the past six months. This cost pressure is transmitted down the chain via pathways such as naphtha → propylene → Propylene Oxide → Polyether Polyols, and aniline → MDI/TDI. The comprehensive rise in feedstock costs provides the foundational support for higher market prices.
However, the more easily overlooked factor is the sharp spike in European natural gas costs. Over the past six months, European natural gas prices have tripled or quadrupled, forcing many energy-intensive chemical plants to reduce operating rates or shut down entirely due to sustained losses. European MDI, TDI, and Polyether Polyols capacity has long been operating at low levels, with leading producers imposing natural gas surcharges on customers. Given that polyurethane is a highly globalized industry, the upward shift in the European price benchmark directly pulls the global pricing system, including the Chinese market, upward for correction.
This point is particularly noteworthy-even if oil prices retreat in the future, the structurally high energy costs in Europe will continue to suppress local capacity utilization, creating a long-term supply gap that cannot be ignored.