Analyzing UHS Q1 2026 Behavioral Health Demand and Outpatient Care Trends

Expected impact of the Middle East conflict on Dow’s 2026 supply chain disruptions

Based on Dow’s Q1 2026 earnings communications, the Middle East conflict is expected to persist as a supply-chain and logistics disruption throughout 2026, with effects that extend well beyond the region—especially through feedstock availability and transit constraints (including the Strait of Hormuz). ¹

1) Dow expects the disruption to continue through 2026 (not just short-term volatility)

• Dow explicitly stated: “We expect the supply disruption will persist throughout 2026.” ¹
• Management also described that the early disruption in March has been propagating through logistics and supply-demand conditions, with Dow referring to a modeled 275 days or longer for the disruption to unwind. ²³

2) Where the disruption is most acute: logistics and “unwind” effects

Dow highlighted that the conflict’s impact is not only physical damage—it also creates logistics-cost and transit-time ripple effects, which then constrain feedstock and product availability across regions. ⁴

• Dow described that transit through the region remains significantly impaired, driven largely by the disruption in the Strait of Hormuz. ⁴
• Dow quantified the logistics shutdown effects as unprecedented in scale:
  • ~20% of global oil capacity offline. ⁴
  • ~half of global ethylene and polyethylene supply either offline, constrained, or directly impacted. ⁴
• Dow further emphasized that the straits moving volumes (including crude, LNG, marine chemical shipments, refined fuel shipments) effectively stopped, and that tankage/logistics clearing plus vessel repositioning is required before plants can restart. ²

Implication for 2026: even if some repair cycles progress, the “logistics unwind” and vessel/tankage clearing process implies continued constraints, which is consistent with Dow’s expectation that the disruption persists throughout 2026. ¹²³

3) Feedstock constraints likely to persist: tightening availability for Asia/Europe

Dow repeatedly tied the conflict to lower feedstock availability and operating-rate constraints, particularly for Asia and Europe.

• Dow said disruption is “amplified across Asia and Europe,” tightening feedstock availability and causing producers to reduce production or raise prices to cover escalating costs. ⁵
• Dow noted that a large portion of Middle East capacity remains offline with increasing risk of lasting infrastructure damage, reinforcing the likelihood of prolonged supply tightness. ⁵
• In Asia Pacific, Dow stated feedstock constraints are limiting operating rates and reducing export availability. ⁵
• Dow also described headwinds on its own supply/operations:
  • Safe proactive shutdown of facilities in Kuwait is expected to create a headwind. ⁶
  • Lower feedstock availability at Thailand joint ventures is also expected to be a headwind. ⁶

Implication for 2026: Dow’s own disclosed headwinds indicate that supply chain disruption is expected to carry into 2026 not only via industry-wide logistics, but also via Dow-specific operational and feedstock availability effects. ¹⁶

4) Capacity additions and industry structure: planned builds may be delayed/canceled

Dow expected lasting structural effects that can worsen supply tightness (and therefore extend disruptions into 2026).

• Dow estimated roughly three quarters of announced global capacity additions would be either directly impacted or dependent on highly constrained supply chains. ⁵
• Dow also said duration/severity increases likelihood of “accelerated capacity rationalization” and “delays or cancellations of planned capacity additions.” ⁴
• Dow stated it anticipate[s] impact to future investments, including potential delays or cancellations and increased pressure for capacity rationalization. ⁷

Implication for 2026: even after immediate physical repair and logistics improvements, delayed/canceled capacity and rationalization can extend the period of supply tightness—supporting Dow’s view that disruption persists throughout 2026. ¹⁵⁴⁷

5) Pricing is not expected to revert quickly—meaning disruptions likely remain economically “real”

Dow indicated the pricing impact of these disruptions is not likely temporary, which increases the odds that supply chain disruptions continue to show up in market conditions through 2026.

• Dow said it is “not likely that the pricing impact of these events will be temporary,” expecting rising global production costs and a steepening global cost curve to continue influencing pricing and spreads. ⁵
• Dow also forecast higher global production costs and persistent effects on market spreads, consistent with ongoing disruptions. ⁵

6) Offsetting factor: Dow’s Americas advantages can reduce the disruption’s effect on Dow’s supply chain

Although the Middle East conflict is expected to persist throughout 2026, Dow emphasized that parts of its footprint are relatively insulated.

• Dow stated Americas continue to operate at high rates, contrasting with Asia/Europe constraints. ⁵
• Dow also described that cost and feedstock advantages in the Americas underscore benefits, and pointed to regional insulation including:
  • North American LNG markets remain well supplied and regionally insulated. ⁴
  • U.S. Gulf Coast NGLs (including ethane) continue to be largely unimpacted. ⁴
• Dow further described that its investments and footprint provide reliability, feedstock security, and cost stability when global supply chains are strained. ⁸

Net effect for 2026: the conflict is expected to cause ongoing global supply chain disruptions, but Dow expects its advantaged footprint (especially in the Americas) to moderate how severely those disruptions constrain Dow versus peers. ¹⁵⁴⁸

---

Bottom line

Dow expects the Middle East conflict to create extended supply chain disruption throughout 2026 driven by prolonged logistics impairment (Strait of Hormuz effects), tightened feedstock availability in Asia and Europe, and lasting industry capacity impacts (delays/cancellations and possible rationalization). ¹⁴⁵⁷ While disruptions are expected to be pervasive, Dow’s Americas-based cost/feeedstock advantages and relative regional insulation are expected to partly buffer Dow’s own supply chain and operations compared with more exposed regions. ⁵⁴⁸