Gas stations are rationing fuel. Hospitals are running out of medical supplies. People are hoarding plastic bags, and factories face packaging shortages.
That’s allhappening in Asia now.
That could become a problem for the United States: Abouthalf the stuffAmericans buy comes from Asia.
If Asian factories are dealing with a lack of supplies, should Americans expect shortages, too?
Possibly – but not just yet. At least not in any widespread or severe manner. But the longer the Strait of Hormuz remains closed, the harder it will become for the United States to avoid the problems piling up elsewhere.
Certainly, the red flags are waving.
War with Iran has threatened the world’s supplies of aluminum, plastics and rubber in particular. The Middle East ships about 25% of the world’s polypropylene and 20% of polyethylene, two of the most-used plastics. It also accounts for a quarter of the world’s sulphur and 15% of its fertilizer.
“You hear a lot about crude oil and the impacts to diesel and gasoline – but feedstocks and petrochemicals are in short supply, too,” said Angie Gildea, KPMG global head of oil and gas.
Several major petrochemical producers, includingSouth Korea’s YeochunandPCS in Singapore, have declared “force majeure,” noted Stephen Brown, chief North American economist at Capital Economics. That means they’re unable to fulfil their commitments to customers.
Other companies say they’re running out of plastic packaging for their products. Acondom makersaid Tuesday that prices would surge because it can’t access manufacturing materials.
Source: Drudge Report
