The increase is the latest signal that escalating energy prices are stoking inflation. Dow supplies a broad swath of industries, from agriculture to health care, and any sizable jump in chemical prices would very likely affect them all.

The price increases will take effect Sunday and will be based on a product's exposure to rising costs. Dow said it spent $8 billion on energy and hydrocarbon-based raw materials in 2002, and that level could climb fourfold to $32 billion this year.

"For years, Washington has failed to address the issue of rising energy costs and, as a result, the country now faces a true energy crisis, one that is causing serious harm to America's manufacturing sector and all consumers of energy," Andrew Liveris, the Dow chief executive, said in a statement.

"The government's failure to develop a comprehensive energy policy is causing U.S. industry to lose ground when it comes to global competitiveness, and our own domestic markets are now starting to see demand destruction throughout the U.S.," he added.

Liveris said soaring costs for Dow were "forcing difficult discussions with customers."

Dow's decision came as little surprise to industry watchers, since prices for natural gas, a key feedstock for the chemical industry, have jumped by 56 percent so far this year, and crude oil prices have rallied 32 percent to more than $125 a barrel.

But whether the company can push through the price increases without losing customers is uncertain. "So much will depend on what Dow's competitors do," said Frank Mitsch, an analyst at BB&T Capital Markets. "Given the raw material inflationary environment, I would guess that most of their competitors will match them."

Dow Chemical, based in Midland, Michigan, makes everything from the propylene glycols used in antifreeze, coolants, solvents, cosmetics and pharmaceuticals to the acrylic, acid-based products used in detergents, disposable diapers and wastewater treatment.

The company said its cost of energy and other feedstocks climbed 42 percent in the first quarter from a year earlier.

Dow has sought to combat high energy prices by forming a joint venture with a unit of Kuwait Petroleum to take advantage of the country's access to energy resources.

That joint venture, in which Dow will receive $9.5 billion for selling a 50 percent interest in five of its businesses, is scheduled to close in the fourth quarter.

Dow will continue its cost-control efforts, Liveris said, and accelerate a "top-down competitiveness review" for all its businesses and manufacturing facilities.

Shares of Dow were up 0.3 percent at $40.35 in afternoon trading in New York on Wednesday.

www.iht.com/articles/2008/05/28/business/dow.php