Dow Chemical earnings fell 27 per cent in the second quarter as the US chemicals producer suffered the largest jump in energy and raw materials costs in its history. The company also warned that US economic conditions would continue to worsen throughout the rest of this year.

Energy and feedstock costs were up 42 per cent, although the company struggled to pass on the rise, raising its prices by only 18 per cent to compensate. Feedstock comprises the input materials, largely oil-based, needed to make the chemicals and plastics that Dow produces.