China Set to Import Record Volume of US Ethane Amid Disruptions from Iran Conflict

Increase in Imports China is projected to import 800,000 tons of US ethane in April 2026, marking a record high, according to Chinese consultant JLC. This volume represents a 60% increase over the monthly average. The surge addresses disruptions in supplies of naphtha and liquefied petroleum gas from the Middle East due to the ongoing Iran war and the effective closure of the Strait of Hormuz.

Ethane serves as a primary feedstock for producing ethylene, essential for plastics manufacturing. China relies almost entirely on the US for its ethane supply. Some petrochemical companies can switch to ethane to mitigate the impact of these supply interruptions.

ethane is favored for its stable supply and lower costs, stated Shi Linlin, an analyst with JLC. As of April 15, 2026, profits from producing ethylene using ethane were ten times higher than those using naphtha, influenced by crude oil-linked pricing, according to JLC data.

A ramp-up in downstream production capacity has also boosted demand for the gas. New ethane units, including one developed by Wanhua Chemical Group and a multi-feed cracker by a petrochemical company, have contributed to higher imports this year, Shi added.

In February 2026, over 50% of China's naphtha imports and more than 40% of its LPG purchases came from Persian Gulf nations, based on Chinese government data. These supplies have been cut off while the Strait of Hormuz remains blocked.

The International Energy Agency stated last week that petrochemical feedstocks are experiencing the most immediate effects from the war, with supply chains to Asia in disarray. Japan has sought naphtha from alternative suppliers, including the US and Africa. China maintains strategic petroleum reserves of 1.5 billion barrels of oil but lacks similar storage for naphtha or ethane.

“The disruption around the Strait of Hormuz has really highlighted how exposed Asia is to Middle Eastern naphtha." — Amber Liu, head of Asia Petchem Analytics at ICIS This year, naphtha-fed crackers account for about 57% of China's ethylene capacity, compared to 16% for ethane, according to Amber Liu. The developments occur ahead of President Donald Trump's planned visit to Beijing in mid-May 2026, where US energy topics are expected to be discussed, particularly if the Iran war persists.”