US benzene prices have crept up over the past few weeks, fueled by increasing feedstock costs even as downstream demand remains soft. The consistent rise in crude and naphtha prices, which are the major raw materials used to produce benzene, has increased the cost of overall production, exerting upward pressure on benzene prices even as derivative sector consumption such as styrene and other aromatics continues to be soft.

The US chemical industry is presently going through a time of uncertainty, with demand softened by general economic prudence and persistent disruptions to world trade. Several benzene market players are postponing buying, going wait-and-see in the face of heightened trade tensions and ambiguous policy indications. A rush of buys in March, much perceived as a bid by customers to stay ahead of impending tariffs, has been succeeded by a clear deceleration of business.

Manufacturers of benzene in the United States are being confronted with a delicate balancing act. Increasing costs from upstream feedstocks such as crude oil and naphtha—both of which have been on an upward trend over the last two weeks—are pinching margins. However, with derivative product demand remaining soft, particularly from styrene monomer units and downstream resin manufacturers, there is little scope to recover these costs from customers.

Adding to the pressure, the future of the U.S. benzene market continues to be shrouded in tariffs and persistent trade restrictions. Analysts caution that prices could come under renewed downward pressure as U.S. producers become more dependent on international markets to take up surplus supply.

Meanwhile, trade realignments globally are piling on additional complexity. While Vietnam begins a 90-day pause in retaliatory tariffs and Chinese demand further slumps, supply chains are being redrawn on the fly. US Shippers and chemical shippers are holding their breaths to see how these evolving dynamics may affect short-term demand and long-term investment decisions.

Adding to the uncertainty is the May 5 OPEC+ meeting when any decision to curb oil production might further drive feedstock prices higher. In the meantime, U.S.-Iran nuclear negotiations continue on a positive note with the two countries set to resume in Europe. Any development in those discussions might shape oil markets, indirectly affecting the price of producing benzene.

In the near term, U.S. benzene prices are expected to remain firm on the back of high production costs. Nevertheless, with external threats building up and benzene demand still lagging, the market may again come under pricing pressure. The majority of the stakeholders are likely to be guarded in the approach to the second quarter, watching closely for developments in trade, energy policy, and global economic indicators.