Understanding the Impact of Geopolitical Changes on PET Film Prices and DPG Tech's Commitment to Customers

The ongoing conflict in Iran has triggered significant disruptions in global energy markets. One of the most critical consequences is the closure of the Strait of Hormuz, a vital shipping route through which nearly 20% of the world’s crude oil passes daily. This closure has caused crude oil prices to surge sharply, with recent data showing an increase of over 16%. Leading financial institutions warn that if the closure continues, prices may climb even higher. This situation has far-reaching effects beyond energy markets, notably impacting industries that rely on petroleum-based raw materials, such as the PET film sector.

At DPG Tech, a professional PET film sales company, we understand how these geopolitical shifts affect our customers. This blog explores the connection between crude oil price fluctuations and PET film costs, and how DPG Tech remains committed to supporting customers through these challenging times.

How the Strait of Hormuz Closure Drives Up Crude Oil Prices

The Strait of Hormuz is one of the world’s busiest and most strategic maritime chokepoints. It connects oil-producing countries in the Middle East with global markets. When this passage closes, oil tankers must take longer, more expensive routes or face supply shortages.

• Daily crude oil transported: Approximately 20% of global supply

• Recent price increase: Over 16% rise in crude oil prices amid the crisis

• Forecast: Major institutions predict further price hikes if the closure persists

  
  

This sharp rise in crude oil prices creates a ripple effect across industries dependent on petroleum derivatives.

The Link Between Crude Oil Prices and PET Film Costs

PET (polyethylene terephthalate) is a polyester widely used in packaging, textiles, and films. Its production depends heavily on petroleum-based raw materials. Understanding the industrial chain helps clarify how crude oil price changes affect PET prices:

• Crude oil is refined into naphtha

• Naphtha is processed into paraxylene (PX)

• PX is converted into purified terephthalic acid (PTA) and monoethylene glycol (MEG)

• PTA and MEG are polymerized to produce PET

  
  

Because crude oil is the primary feedstock, its price fluctuations directly influence the cost of PTA and MEG, and ultimately PET.

Price Transmission in Numbers

• A 10% increase in crude oil prices typically leads to a 5% to 8% rise in PTA costs

• This increase causes a corresponding rise in PET prices

• If crude oil prices rise by 50%, PET prices could increase by 15% to 30% according to market projections

  
  

These figures illustrate how sensitive the PET market is to changes in crude oil prices.

Oil tanker navigating the Strait of Hormuz, a critical route for crude oil transport

The Strait of Hormuz is a crucial route for global crude oil shipments, and its closure impacts oil prices worldwide.

DPG Tech’s Commitment to Customers Amid Price Volatility

Despite the industry-wide pressure from rising raw material costs, DPG Tech is dedicated to maintaining stable PET film prices for its customers. We recognize that price volatility can disrupt supply chains and business planning. Our approach focuses on minimizing the impact of external cost increases.

How DPG Tech Controls PET Film Prices

• Optimized supply chain management: We continuously improve logistics and inventory strategies to reduce unnecessary expenses.

• Long-term partnerships: Our strong relationships with reliable raw material suppliers help secure better pricing and consistent supply.

• Internal cost control: We implement efficient production and operational practices to keep overhead low.

  
  

By combining these strategies, DPG Tech avoids passing on avoidable cost increases to customers. This approach reflects our professionalism and customer-first philosophy.

Practical Examples of DPG Tech’s Customer Support

• When crude oil prices surged by 16%, many competitors raised PET film prices sharply. DPG Tech managed to limit price increases to a minimum, absorbing part of the cost rise internally.

• During supply chain disruptions, we prioritized fulfilling existing contracts to ensure customers received their orders on time.

• We provide transparent communication about market conditions and pricing forecasts, helping customers plan their purchases effectively.

  
  

What Customers Can Expect Moving Forward

The geopolitical situation remains uncertain, and crude oil prices may continue to fluctuate. DPG Tech will keep monitoring the market closely and adjust strategies as needed to protect customers from sudden price shocks.

• We encourage customers to engage with our sales team early to discuss volume commitments and delivery schedules.

• Our team is ready to provide tailored solutions to meet specific business needs during this period.

• We remain committed to transparency, reliability, and partnership.