In the late February 2025, the drop in the US Ethylene Oxide market occurred due to reduced feedstock ethylene prices, with lower demand for downstream industries including polyethylene terephthalate and diethylene glycol. At the same time, Ethylene Oxide prices in the Europe also observed reduction in parallel to the lower-cost feedstock ethylene, while certain downstream sectors such as packaging and plastics witness steady demand, the combination of these factors is putting down Ethylene Oxide prices in both regions, reflecting the market dullness.

The sharp reduction in Ethylene Oxide price in US was due to the noticeably decline in prices of feedstock ethylene, resulting lowered production costs for Ethylene Oxide with curtailed demand from downstream industries. Reduced activity in these markets, uncommonly high availability of Ethylene Oxide was reported. The oversupply and a subsequent price drop as sellers sought to unload stock resulted from the high availability. 

The weak demand for Ethylene Oxide from downstream industries like PET and DEG in the US was due to certain reasons. First and foremost, weak market conditions with all the uncertainty surrounding the economy put pressure not only on the output but also on purchasing activity. The PET and DEG industries both suffered with poor demand because consumers were still not spending, and general market confidence was low. On top of this, with the higher-than-expected inventory levels, a slower pace of orders set in as companies decided to manage existing stock. In turn, that lowered the demand for Ethylene Oxide in these sectors.

European Ethylene Oxide prices also faced a drop, driven by the trend of lower-cost feedstock ethylene, but the demand from certain downstream sectors, such as flexible packaging and plastics bottles, remained steady.  While these sectors provided assistance, the overall market experienced pressure as Ethylene Oxide prices continued to fall.

In addition, destocking activity by traders and a general weakening of global market conditions compounded the fall. A combination of these factors had the effect on prices, as market participants adapted to the uncertainty that was extensive and the low-cost feedstock environment. While the European Ethylene Oxide market remains cautious, with ongoing downward pressure from weak feedstock ethylene support.

As per Chemanalyst, several factors are likely to influence the trend of lowering prices for Ethylene Oxide in the US and Europe countries in the second half of 2025, due to weak feedstock ethylene support which may limit the control on market gains. Ethylene Oxide prices would also be under additional struggling economic conditions regarding its nearby European nations. Besides, rising inventories may encourage traders to engage in destocking activities, hence contributing to additional downward pressure on prices in the coming months.