Reactive molecular dynamics simulations are used to study the initial stage of pyrolysis of phenolic polymers with carbon nanotube and carbon fiber. The products formed are characterized and water is found to be the primary product in all cases. The water formation mechanisms are analyzed and the value of the activation energy for water formation is estimated. A detailed study of graphitic precursor formation reveals the presence of two temperature zones. In the lower temperature zone (<2000 K) polymerization occurs resulting in the formation of large, stable graphitic precursors, while in the high temperature zone (>2000 K) polymer scission results in formation of short polymer chains/molecules. Simulations performed in the high temperature zone of the phenolic resin (with carbon nanotubes and carbon fibers) show that the presence of interfaces does not have a substantial effect on the chain scission rate or the activation energy value for water formation. (C) 2010 Elsevier Ltd. All rights reserved.