Asian Paints Hikes Prices 12% as Hormuz Crisis Inflates Crude-Linked Raw Materials

Asian Paints, India's largest paint manufacturer, has raised product prices by around 12 percent to absorb a sharp rise in crude-linked raw material costs tied to the Strait of Hormuz crisis in West Asia. Company Chairman R. Seshasayee disclosed the move at the firm's 80th Annual General Meeting on July 9, 2026, and Reuters and other outlets reported it on July 13. The adjustment is the steepest single price increase announced by a major Indian paint maker in the current cycle, underlining how directly the Middle East conflict is now feeding into everyday consumer goods.

Crude oil derivatives account for close to half of the raw materials used in decorative paints. Resins, solvents and additives are largely petroleum-based, which leaves manufacturers highly exposed to swings in energy markets. Asian Paints said that fighting in West Asia intensified through the final quarter of its financial year, lifting energy prices and raising the landed cost of imported inputs. The company framed the 12 percent rise as a measured step meant to protect margins without pushing too much of the burden onto buyers.

At the July 9 meeting the chairman pointed to early signs that regional tensions were easing, while cautioning that the outlook stayed uncertain and that input prices could take time to normalise. That cautious optimism has not held. In the days after the meeting, United States and Iranian forces resumed direct strikes around the strait, traffic through the waterway fell back toward a standstill, and Brent crude climbed to about 85.92 dollars per barrel on July 14, its highest level in a month. The renewed escalation has undercut hopes of quick relief on raw material costs, which supports the company warning that a return to stable pricing may take longer than expected.

Other Indian coating companies have moved in the same direction, though less aggressively. Berger Paints India and Kansai Nerolac Paints have lifted prices by roughly 2 to 3 percent, while JSW Dulux has implemented an increase of about 10 percent. The clustering of hikes across the sector points to an industry-wide cost shock rather than a company-specific issue.

The pressure extends well beyond India. In China, prices of common coating solvents such as cyclohexanone, methyl ethyl ketone and ethylene glycol butyl ether have climbed steadily since early July. More than 80 chemical producers across dozens of product lines have cut operating rates, entered maintenance, suspended public quotations or locked supply for priority customers. By the July 13 spot session, cyclohexanone traded near 8,100 yuan per tonne in Shandong and 8,500 to 8,600 yuan per tonne in Guangdong, methyl ethyl ketone averaged about 6,980 yuan per tonne in Jiangsu, and ethylene glycol butyl ether reached 8,500 to 8,600 yuan per tonne in East China. Because coatings, inks and adhesives depend heavily on these solvents, the higher costs are expected to pass through to finished products.

Asian Paints entered this squeeze from a position of strength. For the March quarter it reported a 69 percent year-on-year jump in consolidated net profit to about 1,185 crore rupees and a 10.6 percent rise in revenue to roughly 9,247 crore rupees. Its shares still slipped around 1 percent on the day the price move was reported. Across the affected Indian paint majors, the additional cost passed to buyers from the current round of increases is estimated at roughly 110 million dollars per month, a working figure that will shift with crude prices and demand.

For now the situation remains active. The path ahead depends on whether the West Asia conflict de-escalates and crude prices retreat, on how quickly Chinese solvent producers restart curtailed capacity, and on how much price resistance emerges from downstream paint, ink and adhesive buyers. Until the Hormuz corridor stabilises, further cost pressure on coating raw materials cannot be ruled out.