The Iran war could drive up costs for petroleum-derived products like
clothes and crayons
[April 22, 2026] By
ANNE D'INNOCENZIO
NEW YORK (AP) — It might be hard to imagine the Iran war weighing on
stuffed toys with names like Snuggle Glove, Bizzikins and Wobblies, but
even plush playthings are not immune when oil shipments from the Middle
East are constrained.
Like many soft toys, the creatures developed by a manufacturer in Fort
Lauderdale, Florida, are made with polyester and acrylic, synthetic
fibers derived from petroleum. Three weeks after the war started,
suppliers in China notified Aleni Brands that getting the materials
already was costing them 10% to 15% more, CEO Ricardo Venegas said.
“I think this situation demonstrates how much oil permeates throughout
our system, and we can’t get away from it,” said Venegas, who founded
Aleni Brands last year and is in the process of adding product lines.
“Who would have thought that the price of a toy would have a direct
relationship with oil?”
It's not just toys. Petrochemicals derived from oil and natural gas go
into making more than 6,000 consumer products, according to the U.S.
Department of Energy. Computer keyboards, lipstick, tennis rackets,
pajamas, soft contact lenses, detergent, chewing gum, shoes, crayons,
shaving cream, pillows, aspirin, dentures, tape, umbrellas and nylon
guitar strings are just a few of them.
So far, the war's most tangible and immediate effect for many people
outside the conflict zone has been spiking gasoline prices. Travelers
also are seeing higher airfares and flight fees as airlines respond to
the rising cost of jet fuel. Consumers may find themselves paying more
for food, furniture or any of the myriad of goods transported by trucks
that run on diesel.
But crude oil isn't just refined as fuel. It gets turned into chemicals,
waxes, oils and other mixtures that appear in a vast array of everyday
items, including most made with plastic and rubber. Petroleum
derivatives also are used in a lot of packaging. With disruptions to
global oil supplies now in their eighth week, higher production costs
also could make things more expensive for shoppers, according to trade
groups and some companies.
Venegas, a 30-year toy industry veteran, said he would absorb higher
material costs for now but expects to increase prices for customers by
early 2027, if the war goes on another three to six months.
From crude oil to T-shirts and rugs
While 85% of global oil consumption is in the form of fuel, the rest
goes into a wide range of consumer products, according to Gernot Wagner,
a climate economist at Columbia University's School of Business.
Crude oil is mostly a complex mixture of hydrocarbons, which are
compounds made of carbon and hydrogen atoms. Refineries and chemical
plants separate and break them down to convert them into smaller
chemical building blocks known as petrochemicals.
Six petrochemicals — ethylene, propylene, butylene, benzene, toluene and
xylenes — are the major foundations of plastics and synthetic materials
like nylon and polyesters, which manufacturers in turn use to design and
deliver products. More from the Department of Energy: Automobile parts,
ballpoint pens, curtains, dice, eyeglasses, fertilizer, golf balls,
hearing aids, insect repellant, kayaks, luggage, mops and nail polish.
Materials account for a big share of production costs for many
manufacturers, including those that supply carpets, clothing and tires,
according to Andrew Walberer, partner and global lead in the chemicals
practice of global strategy and management consultancy Kearney.
Take a button-down shirt, for example. Walberer estimated that materials
account for 27%-30% of how much it costs a manufacturer to make one.
Labor costs contribute 10% to 30%. Business expenses tied to marketing,
distribution and administration comprises the rest, he said.
The ripple effect
Experts say if oil holds above $90 per barrel for the next several
months, cost pressures will accelerate throughout the supply network.
Footwear Distributors and Retailers of America CEO Matt Priest said most
of the trade organization's members keep a two- to three-month inventory
of finished products, providing a temporary cushion against higher
materials costs.
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Plush toys are displayed at a Camp store in New York. Camp, Nov. 21,
2019. (AP Photo/Mark Lennihan, File)
 Roughly 70% of the materials in
synthetic shoes are petrochemical-based, and 30% of the costs for
those materials are directly tied to oil price rate swings,
according to a report the organization published last month on the
U.S. footwear industry's “exposure to oil prices & the impact on
shoe costs.”
The FDRA analysis estimated that between materials, factory energy
and transportation, companies paying more for petroleum could
translate into a 1.5% to 3% increase in the price shoppers pay for a
pair of shoes by late summer and the fall.
By the end of April, U.S. shoe and clothing manufacturers need to
start signing contracts with suppliers, mostly outside the U.S., for
orders of polyester staple fiber and polyester filament yarn to get
their designs on retail shelves and online for the holiday shopping
season, according to Nate Herman, executive vice president of the
American Apparel & Footwear Association.
One kilogram, or a little over two pounds, of the materials used in
polyester textiles, has increased in price from an average of 90
cents before the U.S. and Israel attacked Iran to $1.33 per
kilogram, Herman said. He estimated that each garment will cost 10
cents to 15 cents more to produce as a result.
Another cost for importers
Some businesses are looking for ways to offset rising costs.
Lisa Lane is the founder of Rinseroo, which sells portable shower
head, bathtub and sink attachments for cleaning, pet grooming, and
bathing. She recently tripled the number of the slip-on hoses she
procures from China each month after her manufacturer said the cost
would be 30% higher in another 30 days. She had a few days to decide
whether to place a three-month advance order.
The components of Rinseroo's products include petroleum derivatives
like polyvinyl chloride, Lane said. After purchasing 240,000 units
instead of her usual 80,000, she is also evaluating cost-cutting
options.
Lane said she wants to hold off on increasing prices for retailers
that sell the attachments since Rinseroo did that last year to
offset higher U.S. tariffs on imports from China. For example, a
hose for washing pets in a bathtub went up to $33.95 from $29.95 on
retail websites, she said.
“We want to stay at that sweet spot where people want to continue to
buy from us and feel like they’re getting a good value," Lane said.
Another company, which sells wound care products like bandages,
dressings, pads and sponges to nursing homes and other medical
facilities, plans to raise its prices by 15% in a matter of weeks.
Gentell CEO David Navazio noted that adhesives in the products rely
on several petrochemicals.
Including energy for production and materials, Navazio estimated the
company's costs are going up by 20%.
Gentell, which is based in Yardley, Pennsylvania but has its main
manufacturing location in Toronto, also makes private label products
for other companies, including a medical technology firm that
supplies retail stores like CVS.
Because bandages and dressings are necessities, Navazio said he
doesn't think his business will suffer if it raises customer prices.
Less certain is whether prices will come down once the war ends and
oil shipments stabilize.
“In the past, I’ve seen transportation costs come down, but I’ve
never seen prices of raw material come down,” he said.
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