Sabic Petchem Complex Hit as Gulf Strikes Escalate, Adding to Supply-Side Risks — OPIS

Attacks on Saudi Arabia's eastern industrial hub of Jubail triggered a fire at facilities operated by Saudi Basic Industries Corp., intensifying geopolitical tensions across the Gulf and heightening concerns over petrochemical supply disruptions.

Explosions were heard overnight at the sprawling complex, according to a source on the ground, with flames reported at parts of the Sabic site. The incident came hours after Israel said it had carried out strikes on Iran's largest petrochemical facility in Asaluyeh, marking a sharp escalation in the tit-for-tat targeting of energy infrastructure in the region.

Saudi Arabia's air defense systems intercepted seven ballistic missiles aimed at its eastern region, the defense ministry said, though debris from the interceptions fell near power facilities. Damage assessments are ongoing, authorities added.

Al Jubail, one of the world's largest industrial cities, is a key node in global petrochemical supply chains, housing large-scale production of aromatics and derivatives. Sabic has a production capacity of about 240,000 metric tons per year of benzene and 1.15 million mt/year of styrene monomer at the site, making any disruption closely watched by market participants across Asia.

The latest developments follow Israeli strikes on Iran's South Pars petrochemical complex in Asaluyeh on Sunday, where multiple explosions were reported. Israeli officials said the facility accounts for a significant share of Iran's petrochemical output, while additional strikes over the weekend targeted infrastructure linked to exports and upstream chemical production.

Market participants said the near-simultaneous attacks on major petrochemical hubs on both sides underscore growing risks to supply continuity, particularly for benzene and downstream styrene monomer.

"Any sustained disruption in Jubail would tighten regional availability significantly, especially with Asia already facing constrained feedstock flows," a Singapore-based trader said.

Spot benzene discussions in Asia have been firm in recent sessions, supported by supply-side concerns linked to Middle East disruptions. Transactions for the prompt month jumped near 10% in April, rising from $1,079 per metric ton FOB Korea on April 1 to $1,182/mt FOB Korea by April 6.

In SM, supply concerns are more acute given ongoing outages and force majeure declarations across Asia. Market participants said any impact on benzene production in the Middle East could further squeeze SM margins and reinforce upward pressure on prices.

Despite the escalation, some traders noted that the extent of damage to Saudi facilities remains unclear, with no immediate confirmation of prolonged outages.

"The key question is whether this is a temporary disruption or something more structural," another trader said. "If production resumes quickly, the market impact could be limited. But if outages extend, we could see a sharper spike in benzene and SM prices."

The attacks have also raised concerns over logistics and shipping risks in the Gulf, particularly around critical infrastructure and trade routes. Saudi authorities briefly suspended traffic on the King Fahd Causeway linking the kingdom to Bahrain as a precaution, before later reopening it.

With tensions rising and supply chains increasingly exposed to geopolitical shocks, petrochemical markets are expected to remain volatile in the near term, as prices are likely to track developments in the Middle East closely, according to industry sources.

This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.

-- Reporting by Hazel Kumari, hkumari@opisnet.com; Editing by Mei-Hwen Wong, mwong@opisnet.com

(END) Dow Jones Newswires

April 07, 2026 06:25 ET (10:25 GMT)