The Iran war’s impact on shoppers is starting to go beyond gasoline and into the everyday goods built from petroleum, according to an Associated Press report published April 22. The report traced how constrained oil shipments from the Middle East are affecting manufacturing costs through synthetic fibers, petrochemicals and packaging materials that are embedded in many consumer products. While the most immediate consumer-facing costs have shown up at the pump, the materials trail also runs through products as varied as toys, shoes, clothing and medical supplies.
A toy maker in Fort Lauderdale, Florida, described how quickly the oil-linked cost pressure reached its supply chain. Three weeks after the war started, Aleni Brands said suppliers in China notified the company that getting materials already was costing 10% to 15% more, CEO Ricardo Venegas said in the report. Venegas said the episode demonstrated “how much oil permeates throughout our system,” and asked rhetorically, “Who would have thought that the price of a toy would have a direct relationship with oil?” The company also said it was in the process of adding new product lines.
The report said the cost pressure is not limited to soft toys made from petroleum-derived synthetic fibers. It cited the U.S. Department of Energy’s account that petrochemicals derived from oil and natural gas go into making more than 6,000 consumer products. It listed examples that range from computer keyboards and lipstick to detergent, chewing gum, shoes, crayons, shaving cream, pillows, aspirin, dentures, tape, umbrellas and nylon guitar strings, underscoring how widely petroleum chemistry is used across manufacturing.
Beyond direct materials, the report also pointed to the broader way oil-market stress can flow into logistics and pricing. It said the war’s most tangible and immediate effect for people outside conflict zones has been spiking gasoline prices, along with higher airfares and flight fees as airlines respond to higher jet fuel costs. Trucking and diesel use can also drive up transportation costs that feed into prices for food and furniture, the report said, while higher production costs can add further pressure when global oil supply disruptions persist.
Manufacturers, meanwhile, face a system in which crude oil is not only refined into fuel but also transformed into chemical inputs for plastics, rubber and synthetics. The report described crude oil as a complex mixture of hydrocarbons and said refineries and chemical plants convert it into petrochemicals that then serve as building blocks for plastics and synthetic materials such as nylon and polyesters. It also said petroleum derivatives are used in packaging, and that disruptions to global oil supplies in their eighth week at the time of reporting could raise production costs that reach shoppers.
Trade and industry groups in the report warned that if crude oil stays elevated, companies may see accelerating cost pressure through the supply network. It cited an expert expectation that if oil holds above $90 per barrel for several months, cost pressures would accelerate, and it pointed to a cushion that some distributors have while inventories carry. Footwear Distributors and Retailers of America CEO Matt Priest said many members keep a two- to three-month inventory of finished products, and the report said an FDRA analysis published the prior month estimated materials, factory energy and transportation could produce a 1.5% to 3% increase in the price shoppers pay for a pair of shoes by late summer and the fall.
The report also described how timing matters for seasonal goods. By the end of April, U.S. shoe and clothing manufacturers need to start signing contracts with suppliers, mostly outside the U.S., for polyester staple fiber and polyester filament yarn to have products available on retail shelves and online for holiday shopping, the report said. Nate Herman, executive vice president of the American Apparel & Footwear Association, said one kilogram of materials used in polyester textiles rose from an average of 90 cents before the U.S. and Israel attacked Iran to $1.33 per kilogram. Herman estimated each garment could cost 10 cents to 15 cents more to produce as a result, according to the report.
Some companies in the report said they are trying to manage costs with purchasing decisions and pricing strategies. Lisa Lane, founder of Rinseroo, said her manufacturer told her the slip-on hoses she buys from China would cost 30% more in another 30 days, and she responded by tripling the number of hoses procured each month. Lane said Rinseroo’s components include petroleum derivatives such as polyvinyl chloride, and that buying 240,000 units instead of her usual 80,000 put pressure on her to evaluate cost-cutting options. She said the company wants to avoid raising prices for retailers at a time when it previously raised prices to offset higher U.S. tariffs on imports from China.
The report also highlighted a medical supplier’s approach to cost increases. Gentell CEO David Navazio said the adhesives used in wound care products rely on several petrochemicals and that the company plans to raise prices by 15% in a matter of weeks. Navazio estimated Gentell’s costs are going up by 20% when including energy for production and materials. He said Gentell, based in Yardley, Pennsylvania, manufactures in Toronto and also makes private label products for other companies. Because bandages and dressings are necessities, Navazio said he does not think the business will suffer if it raises customer prices, though the report said he was less certain whether prices will come down after the war ends and oil shipments stabilize.