In February 2025, a downward trend in the USA o-xylene market was observed, where prices continued declining w-o-w basis. Prices remained stable in the first week but noted a significant drop during the second week of the month. Prices continued falling within the third and fourth weeks, making a continuous decline throughout this month. Meanwhile, Europe witnessed a slight increase and stable price trend throughout the month.

This price drop was influenced by several elements. Feedstock naphtha prices noted slight reductions, while crude prices remained steady. However, it was noted that these price changes had a meagre impact on o-xylene costs. The demand from the downstream derivative Phthalic Anhydride was steady but contributed to the overall weakened market sentiment that helped pace down the falling of o-xylene prices.

The major contributing factor for the price drop was sluggish downstream demand, especially from Phthalic Anhydride. There was a high inventory level, and, even with a steady supply, the market sentiment was not strong enough to boost demand. Prices then fell as a result of supply-demand imbalance because no important market activity could push prices up.

The European o-xylene market was quite varied throughout the month of February. While a slight increase in prices was noted in the first week of February, stability was achieved in the second to the third week with prices remaining steady. A further o-xylene price increase came in the fourth week, further indicating similar movements noted in the early part of the month.

Little fluctuations in the prices of feedstock naphtha affected the production cost of o-xylene. However, demand continued to hold up well for o-xylene, particularly from the Phthalic Anhydride sector, hence underpinning price stability during the mid-weeks of February.

The o-xylene price increases noted in the first and fourth weeks were basically informed by the balance of tighter supply up against more expensive raw material inputs. Maintenance of the stability of the market was underpinned by the Phthalic Anhydride sector's steady rates of consumption. Since the production cost of o-xylene went up, there were no high requests for o-xylene; this permitted slow adjustments without huge disruption in the market.

As per ChemAnalyst, the o-xylene market in the USA and Europe is expected to accelerate on the upside in the second half of 2025. In the USA, recovering after feedstock costs stabilize and demand from key sectors like Phthalic Anhydride bounces back; in this instance, prices are likely to be supported by rebounding market sentiment and improving demand growth. Meanwhile, in Europe, prices are expected to increase owing to stronger demand from key sectors such as Phthalic Anhydride and steady production costs as the market experiences tighter supply.