By Azusa Kawakami, Megumi Iwano
Japan Chemical Industry Association Chairman Tsutomu Tannowa (president and CEO of Mitsui Chemicals) noted at a press conference held on Sept. 20 that “domestic chemical engineering plants could be adversely affected” if escalating tensions in the Middle East linger and oil and naphtha supplies run short. Crude output has been on the decline since the Sept. 14 attacks on oil facilities in Saudi Arabia.
Crude price fluctuations will “have a severe impact on earnings of chemical manufacturers as the risk of economic downturn is growing,” Tannowa said. Meanwhile, the U.S. is hinting at the possible involvement of Iran in the recent strikes on Saudi oil facilities. “With the U.S. stepping up economic sanctions on Iran, country risk involving the Middle East is growing stronger than before,” he said.
At a press conference given on the same day, Japan Iron and Steel Federation Chairman Yoshihisa Kitano (president and CEO of JFE Steel Corporation) noted that the impact of the attacks on the oil facilities “could be limited as production is expected to resume.” He indicated that “crude price increases will definitely result in higher costs for the steel industry” and noted that the federation will “closely monitor the possible impact on the industry.”