Automobile manufacturers are experiencing significant cost pressures due to the West Asia conflict, with key raw material prices rising sharply since March 2026. According to data from the Society of Indian Automobile Manufacturers (Siam), steel prices increased around 10% year-on-year to approximately ₹60,000 per tonne in March 2026. The pressure was further intensified by a 31% surge in coking coal prices, a critical raw material used in steel production. Non-ferrous metals also recorded strong gains, with aluminium and copper rising 27% and 28% respectively. The conflict has triggered what Bloomberg describes as the world's greatest energy crisis, with the Strait of Hormuz disrupted, affecting 35-50% of India's crude imports despite a shift towards Russian crude. Recent developments show that around 13% of global ethylene capacity and roughly 20% of methanol production are currently offline due to conflict zone exposure, highlighting the scale of disruption across petrochemical markets.
The plastics segment experienced even sharper price increases, with thermoplastics like polypropylene rising up to 34% to ₹136.2 per kg in March 2026 from ₹102 a year ago. As reported by The Times of India, polycarbonate was up 9% at ₹227 in March 2026. Precious metals used in emission control systems saw steep spikes, with platinum rising 124% to ₹6,196 per gram, rhodium 121% to over ₹33,000 per gram, and palladium 74% to ₹4,712 per gram. These increases are pushing up costs of essential emission control devices in cars. According to Crisil's analysis, India's fertilizer production declined 24.6% year-on-year in March amid a shortage of natural gas, highlighting the broader impact of energy disruptions on manufacturing sectors. The petrochemical crisis has intensified further with naphtha prices in Singapore climbing to around $1,000 per ton by the end of March from roughly $780 earlier in the month, while ethylene and polyethylene prices have roughly doubled.
The West Asia conflict is creating ripple effects across global consumer companies, with Procter & Gamble warning of substantial fiscal losses as rising energy and commodity prices threaten to undermine fragile demand recovery. As reported by The Economic Times, P&G's finance chief Andre Schulten highlighted shifting consumer dynamics, predicting further turmoil over the next few years. The oil shock is intensifying inflation pressures across sectors, with companies under pressure to transfer rising energy and healthcare costs to consumers. Despite recent upticks in sales volumes for companies like Nestle and Danone, analysts warn these gains may be short-lived if new price increases occur. As brands like Reckitt, Unilever, and Coca-Cola prepare to disclose earnings, they face decisions on whether to prioritize price stability or sales volume amid increasing consumer cost sensitivity. The petrochemical disruptions are expected to create sustained shortages of polyethylene and polypropylene, with downstream industries such as construction, packaging and automotive manufacturing expected to feel the impact.
