Dow-Aramco venture idles capacity as Middle East instability spreads

Sadara Chemical Company, a joint venture between Saudi Arabia’s state oil giant Aramco and US-based Dow, has suspended production at its large-scale petrochemical complex due to ongoing disruptions in global supply chains, the company confirmed on Tuesday, March 31.

The announcement was made through Sadara Basic Services, a subsidiary responsible for issuing Islamic bonds on behalf of the parent company. In its statement, cited by Reuters, the firm said it is currently unable to determine when operations will resume, emphasising that the timeline will depend on a range of internal and external factors.

Sadara operates a major industrial facility in Jubail, Saudi Arabia, with an annual production capacity exceeding 3 million metric tons of chemicals and plastics. The halt in operations is expected to have a negative impact on the company’s financial performance for the current year.

The disruption comes amid escalating regional instability. A month-long war involving Iran has expanded across the Middle East, significantly affecting energy supply routes and raising concerns about broader implications for the global economy. In response to strikes by the United States and Israel, Tehran has launched retaliatory attacks targeting regional infrastructure and maritime shipping, further complicating supply chains and industrial operations.

By Tamilla Hasanova