International Oil Prices Rise, Plastic Futures Across the Board

Overnight Crude Oil Market Dynamics

1/23: The United States plans to strengthen sanctions on the oil sectors of some countries, increasing concerns about potential supply risks and leading to a rise in international oil prices. NYMEX crude oil futures for March delivery rose by $1.71/barrel to $61.07/barrel, a 2.88% increase month-on-month. ICE Brent crude oil futures for March delivery rose by $1.82/barrel to $65.88/barrel, a 2.84% increase month-on-month. China's INE crude oil futures for March delivery fell by 6.9 to 439.4 yuan/barrel, and rose by 10.4 to 449.8 yuan/barrel in night trading.

Market outlook

The U.S. maintains sanctions against oil-producing countries like Iran, and potential supply risks persist.

2. Severe cold weather hits the US, potentially decreasing US crude oil production. (Positive)

Some oil fields in Kazakhstan have not yet resumed normal production, leading to a short-term tightening of supply. (Bullish)

II. Macro Dynamics

Silver prices continue to surge, with COMEX silver and spot silver successively breaking through the historic $100/ounce mark and standing above $103. The year-to-date cumulative increase has exceeded 40%, far outperforming gold during the same period. Meanwhile, gold prices continue their push towards $5000, with COMEX gold futures once reaching $4991/ounce.

President Xi Jinping held a phone conversation with Brazilian President Luiz Inácio Lula da Silva. Xi emphasized that amid the current turbulent international situation, as key members of the Global South, China and Brazil should stand firmly on the right side of history, better safeguard the common interests of the two countries and the Global South, and jointly uphold the core position of the United Nations as well as international equity and justice.

The Brazilian Presidential Palace announced that President Lula has declared visa exemptions for certain short-term visa categories for Chinese citizens, in response to China's visa-free policy for Brazilian citizens. The announcement stated that this decision, made in the context of deepening cooperation between Brazil and China, aims to further facilitate people-to-people exchanges and promote bilateral exchanges. The implementation date of the policy is yet to be announced.

◎ The National Market Operation and Consumption Promotion Work Conference emphasized the need to expand and upgrade commodity consumption, improve the quality and efficiency of consumer goods trade-ins, and promote large-volume consumption such as automobiles and home furnishings. It also called for accelerating the cultivation of new growth points for service consumption and unleashing its potential. Furthermore, it stressed fostering new forms of consumption, actively promoting the "first-store economy," and developing digital, green, and healthy consumption.

Data released by the Ministry of Commerce shows that in 2025, the actual use of foreign capital nationwide totaled 747.69 billion yuan, a year-on-year decrease of 9.5%. Among them, the actual use of foreign investment in e-commerce services, medical instruments and equipment manufacturing, and aerospace vehicle and equipment manufacturing increased by 75%, 42.1%, and 22.9% respectively.

◎According to the National Bureau of Statistics' monitoring of market prices for 50 important means of production in 9 categories in the national circulation sector, compared with early January 2026, in mid-January, prices of 29 products increased, 13 decreased, and 8 remained unchanged. Among them, the price of live pigs (of the foreign three-way crossbreed) increased by 0.4 yuan/kg, a rise of 3.2% compared to the previous period.

In 2025, Shandong Province achieved a regional GDP of 10.3197 trillion yuan, an increase of 5.5% over the previous year. Shandong became the third province in the country and the first in northern China to surpass 10 trillion yuan in GDP.

III. Plastics Market Morning Update

The US plans to strengthen sanctions on the oil sectors of some countries, raising concerns about potential supply risks and leading to an increase in international oil prices; plastic futures main contracts all rose across the board.

Plastic 2609 futures closed at 6947 yuan/ton, up 0.94% from the previous trading day.

PP2605 contract is reported at 6718 yuan/ton, up 1.07% from the previous trading day.

PVC2605 contract closed at 4934 yuan/ton, up 1.21% from the previous trading day.

Styrene 2603 contract is trading at 7706 yuan/ton, up 0.16% from the previous trading day.

IV. Market Forecast

PE: In the short term, petrochemical inventory reduction is accelerating, but inventory is shifting to midstream traders. Under high supply in the midstream market, destocking pressure still exists, limiting the upside potential of prices. On the demand side, downstream factories are gradually reducing operating rates and primarily purchasing on a need-to-use basis, maintaining just-needed inventory during the Spring Festival. High market prices are likely to be difficult to transact. It is expected that the polyethylene market will continue to weaken this week, with a comprehensive assessment of the oscillation range at 50-100 yuan/ton.

PP: Geopolitical instability persists, coupled with capital market support boosting market sentiment. Fundamentally, supply-side maintenance losses remain high, with shutdown impact maintaining at a high level of 20.30%, providing decent supply-side support. Downstream enterprises are expected to shut down and take holidays early, resulting in limited new orders and gradually weakening willingness to accept goods. The polypropylene market is expected to rise and then fall back this week.

PVC: Next week, the scale of maintenance for PVC production enterprises will be weak, and downstream production demand will weaken due to holiday influences, leading to continued inventory accumulation pressure in the industry. Cost support is limited, but the economic environment is expected to support a positive market trend. It is anticipated that the spot market for PVC will have limited fluctuations this week, with insufficient spot transaction support. However, positive market sentiment is expected to underpin price firmness. The ex-warehouse price for calcium carbide-based PVC type 5 in East China is estimated to be in the range of 4550-4650 yuan/ton.