European plastic packaging association Elipso has condemned what it calls abusive force majeure declarations by major resin producers including INEOS, LyondellBasell, Sabic, and Indorama, warning that speculative price increases threaten the viability of converters across the continent. The conflict between the US, Israel, and Iran has effectively closed the Strait of Hormuz, through which about 20% of global oil and gas flows, triggering raw material shortages and sharp price spikes. Market reports indicate attempted price increases of at least €400–500 per tonne for polyethylene (PE) and polypropylene (PP), directly impacting existing contracts and squeezing converters' margins.
Industry backlash against force majeure claims
Elipso argues that many force majeure notifications are unjustified under international legal principles (FIDIC and ICC), which require an unforeseeable, irresistible event beyond the parties' control. The association points to evidence that some producers not directly affected by Strait of Hormuz disruptions are using the geopolitical situation as a pretext to unilaterally renegotiate contracts, impose steep price hikes without a direct causal link, and prioritize exports to higher-margin regions at the expense of European supply.
Legal and public pressure campaign
Elipso and other European associations have launched an immediate action plan. Converters are urged to use guidelines and template letters from the Polymers for Europe Alliance to formally challenge erroneous force majeure claims. Legal precedent holds that a mere increase in contract execution costs does not constitute force majeure. The campaign also includes economic press alerts to expose speculative practices and a "name and shame" strategy to publicly identify producers deemed to be engaging in unethical commercial behavior.
Direct quote from industry leadership
"We cannot accept that the geopolitical crisis is used as a tool for price manipulation. Force majeure must not become a clause of commercial convenience to escape contractual obligations," said Gaël Bouquet, Director General of Elipso.
What buyers should watch
European PE and PP buyers should prepare for continued volatility and potential supply tightness as the Strait of Hormuz situation evolves. The legal challenge from converters may lead to contract renegotiations or delays in price implementation. Importers and distributors should verify force majeure claims from suppliers and consider alternative sourcing options from regions not directly affected by Middle East disruptions. The outcome of this dispute could set a precedent for force majeure practices in the global resin market.
Source: Read the original report | Published: April 20, 2026