A large share of global naphtha exports comes from the Gulf region.

The current conflict has created fears that supplies will be interrupted, which pushes prices up.

Traders are worried about refinery disruptions and shipping risks in the region.

ChatGPT

Naphtha prices are rising mainly because of the Middle East war and supply disruptions.

1. Supply disruption from the Middle East

A large share of global naphtha exports comes from the Gulf region. The current conflict has created fears that supplies will be interrupted, which pushes prices up. Traders are worried about refinery disruptions and shipping risks in the region.

About 40% of global naphtha exports originate in the Middle East.

Any threat to production or shipping routes immediately tightens supply expectations.

2. Strait of Hormuz risk

The Strait of Hormuz is a key route for oil and petrochemical feedstocks. Tensions and blockades there have reduced flows and spooked markets.

When traders think shipments might be delayed or halted, they bid prices higher to secure cargo.

3. Crude oil surge

Naphtha is produced from crude oil, so when oil prices rise sharply, naphtha usually follows.

The war has already pushed global oil prices significantly higher, which feeds directly into naphtha pricing.

4. Petrochemical plants competing for supply

Naphtha is the main feedstock for plastics and chemicals. With supplies tight, petrochemical plants are scrambling for cargoes and some are cutting production because they can’t get enough feedstock.

That scramble drives short-term price spikes.

✅ In simple terms:

War → shipping and refinery risks

Less expected supply → traders panic-buy cargoes

Oil prices rise → naphtha rises with them

That combination is why naphtha has jumped sharply in recent days.

If you want, I can also explain why naphtha in particular (not diesel or gasoline) is reacting so violently to the Iran war—there’s a structural reason in the petrochemicals market.

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Yes—there is a fertiliser link, although it’s indirect and weaker than the connection with natural gas.

1. Naphtha can be used to make ammonia

Fertilisers such as Ammonia, Urea, and Ammonium Nitrate are built from hydrogen.

Normally that hydrogen comes from Natural Gas, but in some regions (especially parts of Asia) it can also come from Naphtha via reforming.

So if naphtha becomes expensive, fertiliser production costs can rise for plants that use it as feedstock.

2. Petrochemicals compete for the same feedstock

Naphtha is widely used in steam crackers to produce petrochemicals such as Ethylene and Propylene (the building blocks for plastics).

When petrochemical demand is strong, it:

• pulls more naphtha into plastics production

• tightens supply

• indirectly raises input costs for fertiliser plants using naphtha

3. Regional effect

This matters most in:

•Japan

•South Korea

•Taiwan

• parts of India

These countries historically built ammonia plants designed to run on oil products rather than gas.

4. The bigger fertiliser driver is still gas

Globally, around 70–80% of ammonia is made using natural gas through the Haber–Bosch Process.

So usually:

•gas prices → fertiliser prices (strong link)

•naphtha prices → fertiliser prices (secondary link)

Bottom line

Yes—rising naphtha can feed into fertiliser prices, but mainly:

• in Asia, and

• as a cost pressure on ammonia production, not the primary global driver.

If you want, I can also explain why fertiliser traders are suddenly watching oil markets again in this war—it hasn’t happened like this since the 1973 oil crisis.