Series 4 · Market · Updated weekly
Oil, gas
and resin costs
PP and PE start from crude oil, natural gas and propane. This article explains how energy prices pass through to resin costs, why resin prices lag oil, and what a converter can control.
Published 22 Oct 2026 · Marketing Department, ADVANCEDCHEM SOLUTIONS CO., LTD.
Latest prices 20 Oct 2026
Crude oil is still almost double last year's level and swinging hard week to week, so feedstock costs for PP and PE in Asia remain under upward pressure.
See Brent, WTI, Henry Hub and propane prices with 26-week charts on the market update page →
From oil and gas to PP and PE
PP and PE do not come from crude oil by one route. Each route starts from a different feedstock, so its cost follows a different price. Knowing which region and route your resin comes from helps you read where its price is heading.
| Feedstock | Process | Monomer | Resin | Price to watch |
|---|---|---|---|---|
| Naphtha (from crude refining) | Steam cracker | Ethylene, propylene | PE, PP | Brent |
| Ethane (from natural gas) | Ethane cracker | Ethylene | PE | Henry Hub (US) |
| Propane | PDH (propane dehydrogenation) | Propylene | PP | Propane |
| Gulf of Thailand gas + naphtha | Gas separation plants and domestic crackers | Ethylene, propylene | PE, PP made in Thailand | Brent and gas prices |
What this means in the market: when crude rises sharply while US natural gas stays cheap, PE producers running on ethane gain a cost advantage over naphtha crackers. Propane prices matter for PP made from PDH propylene.
Why resin prices lag oil
- Inventory and contracts: producers hold feedstock in stock and many contracts are priced monthly, so resin prices usually move several weeks later.
- Resin supply and demand: when regional capacity exceeds demand, resin prices may not follow oil fully and producers accept thinner margins.
- Freight and exchange rates: imported resin is priced in dollars; the baht and ocean freight change what your plant pays even when feedstock prices hold.
- Specialty grades: grades with few producers or special additives are usually less tied to oil than commodity grades.
What a converter can do
Nobody calls the bottom of the market every time. What you control is cost per good part, not only price per kilogram.
- Cut scrap: every 1% of scrap is resin you paid for and threw away. The dearer the resin, the bigger the hit.
- Get value from production scrap: reuse it in-house, or join the back-of-plant scrap to front-door feedstock program.
- Consider part recycled resin where the spec allows. Recycled resin prices are less tied to oil, but still partly follow virgin prices.
- Work out your own plant's numbers with the Cost-in-Use calculator.
Please note
This page is for learning, not trading or investment advice. The energy prices are US and European spot prices from the EIA, not resin prices. What your plant actually pays for resin depends on grade, supplier, volume and commercial terms.
Frequently asked questions
When oil goes up, do resin prices go up straight away?
Not straight away. PP and PE prices usually follow with a lag of several weeks: producers hold feedstock inventory, many contracts are priced monthly, and resin prices also depend on regional supply, demand and capacity.
Why watch gas and propane, not just oil?
Because resin is not made from naphtha alone. PE can be made from ethane in natural gas, and propylene for PP can be made from propane by PDH. Each route's cost follows its own feedstock price.
Where does the data come from and when is it updated?
Crude oil, natural gas and propane prices come from the U.S. Energy Information Administration (EIA), which is public data, updated every Monday. The summary is written by the ACS marketing team for learning, not as trading advice.
