In April 2025, differences in naphtha prices globally are being seen due to shifts in trade flows, increased petrochemical integration and shifting geopolitical tensions that are altering the petrochemical market. Naphtha prices increased in Saudi Arabia and China in the third week of April but decreased in the US exhibiting mismatches between regional supply and demand as well as varying governmental objectives.

The rise in naphtha prices in China is in line with a rising reliance on the feedstock as a substitute for LPG due to the Sino-US trade war. As U.S. LPG cargoes start to face tariffs from May 14, Chinese petrochemical firms are quickly shifting towards naphtha as a critical feedstock. Analysts forecast declining demand for LPG in China while naphtha prices settle higher as they utilize more of it especially in steam crackers.

Naphtha prices also rose in Saudi Arabia, aided by structural changes in the refining sector.  Reduced exports of naphtha are a result of Aramco's attempt to integrate petrochemical activities with refineries, such as the Jizan and Yasref complexes, which is tighting up supply in the region. As Aramco aims to produce up to 4 million barrels of crude a day as petrochemicals by 2030, this trend is likely to continue, further lending support to the naphtha price strength.  Saudi naphtha exports have already been steadily declining over the last four years, according to historical records.

On the other hand, over the same time period, naphtha prices decreased in the US.  Because of increased domestic production and fewer export choices as a result of the trade war with China, the United States' supply is nevertheless plentiful.  The U.S. petrochemical and energy markets are seeing downward pressure on naphtha pricing and broader natural gas liquids (NGLs), such as propane and ethane, as Chinese purchasers are switching from U.S. LPG to other feedstocks.

At the heart of these changes in the energy sector is the trade war between the United States - China.  Global trade lines have changed as a result of Chinese LPG importers looking to substitute Middle Eastern supply for American shipments.  Meanwhile, nations like Japan and India are intervening to obtain cheaper U.S. LPG, intensifying the struggle for feedstocks.  But when China's demand changes, these changes are also indirectly boosting naphtha prices in Asia.

Blend 22, a new crude grade, is being introduced by Venezuela's PDVSA in order to sustain earnings following the expiration of U.S. licenses.  By concentrating on the blending and refining of oil, this action seeks to diversify exports and could free up naphtha for regional or domestic usage.

ChemAnalyst observes, Asian consumers are reacting to changes in the market. While the Japanese utilities are building up their inventories, and Indian refiners are investigating U.S. LPG as a less expensive substitute for Middle Eastern supply.  Naphtha prices have increased throughout Asia due to the growing demand for heavy naphtha in gasoline mixing and aromatics.  In order to predict future naphtha prices, market players are keeping a careful eye on whether new Aramco-Sinopec mixed-feed crackers would tilt more toward naphtha or LPG.  Price volatility is anticipated to persist until Q2 2025 due to changes in regional supply and geopolitical tensions.