Air Products' European operations hit as Middle East conflict lifts energy costs

By Sumit Saha

March 18 (Reuters) - Industrial gases maker Air Products' APD.N operations in Europe are being significantly impacted by rising energy costs, as supply disruptions due to the Middle East conflict send oil and liquefied natural gas prices soaring.

However, overall impact has been limited despite some plant closures, largely driven by broad increases in energy costs rather than any major disruption to its own production, CEO Eduardo Menezes said at a JPMorgan conference on Wednesday.

Menezes also addressed concerns about helium output, saying the industry would find ways to keep critical customers supplied even if disruptions persist.

Natural gas processing in Qatar has been severely impacted by the U.S.-Israel war on Iran, pushing helium prices sharply higher since the gas is produced as a byproduct of LNG processing.

Air Products has activated contingency measures, including drawing on storage and running U.S. liquefaction plants at higher utilisation, Menezes said, though he warned that the helium market has become more volatile since the U.S. government sold its reserves in 2024.

The company has limited production operations in Qatar, Menezes added.