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Strike on Saudi Arabia’s oil facility rattles fashion sector

The attack on a major hub of Saudi Arabia’s oil production has shaken up the fashion industry. The first impact be on the fashion industry as it increases logistics costs. Since fashion is a completely globalized sector, both in supply as in distribution, higher gas prices will make transport more expensive. Fearful of any impact on their margins, fashion giants are scared of a rise in logistics prices in the short term. In the long term, the fear is that it might eventually impact fashion’s main raw material, polyester.

Polyester is the star fiber of the fashion industry. Since the ’70s, its production and consumption have kept growing. Between 2000 and 2017, its production tripled. Polyester demand in the fashion industry skyrocketed in 2011 because of the escalation of cotton prices. However, this market didn’t seem to be touching the ceiling. Until now. Synthetic fibers are expected to grow an average five per cent a year until 2022. Polyester has brought about significant changes in how apparel products are made, priced, and distributed. China accounts for 69 per cent of all polyester fiber production globally, and if India and Southeast Asia are added to the equation, these three regions represent 86 per cent of global polyester production.