The European Phenol market saw a bullish price surge in June 2025 due to tight supply from high energy costs, carbon taxes, and Ineos Phenol's Gladbeck plant closure. Weak demand from construction and automotive sectors further contributed to the imbalance. Prices are expected to remain high due to continued supply limitations.
During the third week of June 2025 the Phenol market in Europe has shown a bullish pricing trend driven by a mix of market constraints and strategic shutdowns. Prices of Phenol have surged due to tightening supply and unfavorable operating conditions across the region. A strong upward push in prices was observed as several market participants faced limited availability of Phenol amidst the rising operational challenges. With price direction clearly inclined towards an upward trend, Phenol was seen trading higher compared to previous months and buyers were grappling with reduced material availability.
The European Phenol market was under pressure due to several negative factors affecting both the supply and demand side. One of the major concerns includes the soaring energy costs which continued to affect chemical manufacturing in Europe. Alongside energy carbon tax policies have added further cost burden to Phenol producers. These policies have made production in Europe more expensive compared to Asian countries especially China where low-cost imports have created heavy pressure on domestic producers.
On the demand side downstream industries such as paints, coatings, laminates and particularly phenolic resins have shown weak consumption patterns. The construction sector which was a key end-user of phenolic resins has witnessed slowed activities thereby impacting the demand for Phenol. Additionally, the automotive sector where Phenol was crucial for producing phenolic resins used in brake pads under-the-hood applications and interior parts was also facing reduced activity. As demand from these segments weakened the imbalance in the market grew as evident.
Adding to the concerns Ineos Phenol the largest producer of Phenol and acetone globally has announced the permanent closure of its Gladbeck plant in Germany which has a production capacity of 650,000 metric tons per year. This closure is expected to result in a notable supply gap in the European Phenol market. The decision was made after a thorough internal review and was attributed to Europe’s uncompetitive energy costs and strict carbon tax structure. Ineos also stated that several downstream consumers in Europe have exited the market further lowering the domestic demand and making the site no longer viable to operate. As a result, the shutdown of this major plant is likely to provide room for price increases in the upcoming weeks as supply tightens and producers adjust to the reduced output.
As per ChemAnalyst Pricing Intelligence Phenol pricing trend for the European region is expected to remain bullish in the following weeks. The market is projected to see continued supply limitations due to the plant shutdown while ongoing energy and policy challenges is more likely to restrict any major production recovery.
