Conflict in Ukraine could impact synthetic rubber market

LONDON—The severe escalation in Ukraine has raised concerns over possible disruption to the European petrochemical market, with synthetic rubber among the sectors facing potential fallout.

According to analysts at London-based Argus Media, with broader sanctions now looking increasingly likely, Europe-based participants will be assessing their risk-exposure and options.

Some buyers of Russian chemicals and downstream products, such as synthetic rubbers, may already have brought forward some contractual purchases, suggested an Argus report issued Feb. 23.

Buyers, it added, are "likely to be increasingly cautious about future purchases from Russia in cases where they have other options."

Regarding the synthetic rubber supply-chain, Argus noted that Russia exports large volumes of rubber across the globe to many of the major tire manufacturers.

These exports mainly comprise polybutadiene, styrene butadiene and isoprene rubber, said Argus, adding that tire makers have been building up stocks in anticipation of new sanctions.

"At the same time, some European synthetic rubber producers may see sanctions on Russia as an opportunity to regain market share," suggested the report.