Dow is assessing whether to divest its interest in the $20 billion chemicals partnership with Saudi Aramco, with one option under consideration being a sale of its 35% stake in Sadara Chemical Co to Aramco, according to people familiar with the situation. The company is also expected to consider offers from other strategic or financial buyers, though no final decision has been reached.
Dow did not immediately respond to a request for comment. Aramco declined to comment.
Management has pointed to the compounded pressures on the chemicals business that have prompted the review. The ongoing US-Israeli war on Iran has disrupted oil and petrochemical flows, constrained supply chains and pushed up transportation and operating costs. Dow said in July that the conflict had directly affected its joint ventures in the region.
Those developments have layered onto an industry already under strain from stagnant demand, rising production costs in Europe, shifting regulatory requirements and persistent global oversupply. Together, these factors have increased the urgency for companies in the sector to reassess asset portfolios and improve profitability.
Dow has been actively reviewing its global operations in recent years as part of efforts to boost returns. That program has included a review of European assets in 2024 and consideration of non-core holdings across its worldwide portfolio. In January, the company announced plans to reduce its workforce by about 13% as part of broader cost and performance measures.
The Sadara joint venture operates a large chemicals and plastics complex in the Saudi city of Jubail, with annual production capacity in excess of 3 million metric tons. Production at the Jubail complex was temporarily halted earlier this year after supply chain disruptions tied to the Middle East conflict.
On the company’s balance sheet, Dow reported a negative investment position of $793 million in Sadara as of June 30. The chemicals maker also suspended recognition of losses from the venture during the first quarter of 2026.
Market reaction to the news included a decline in Dow’s share price, which traded down by more than 1% on the day of the reports.
Separately, an investment service that evaluates stocks using a range of financial metrics has highlighted DOW among thousands of companies it monitors, noting that its automated strategies analyze fundamentals, momentum and valuation to identify opportunities. The service said it assesses stocks without bias and that it generates model-driven ideas based on current data.
As the company weighs options for Sadara, potential outcomes range from a direct sale of Dow’s stake to Aramco, to a competitive process involving other bidders. No timetable or final determination has been disclosed.