Iran Formally Rejects Negotiations! Brent Crude Surges Over 3%, Futures Rally Across Energy And Chemicals Sector, Styrene Jumps 2.37%

Overnight Crude Oil Market Dynamics

The timing for the second round of U.S.-Iran talks has yet to be finalized, and the U.S. continues its blockade of the Strait of Hormuz, prolonging supply risks and driving international oil prices higher. NYMEXCrude Oil FuturesThe NYMEX WTI crude oil futures May contract rose by $2.52/bbl to $92.13, up 2.81% week-on-week; the ICE Brent crude oil futures June contract rose by $3.00/bbl to $98.48, up 3.14% week-on-week. The INE crude oil futures June 2026 contract rose by 8.2 yuan/bbl to 613.9 yuan/bbl, and gained 16.7 yuan/bbl to 630.6 yuan/bbl during the night session.

Market Outlook

A two-week temporary ceasefire between the United States and Iran, which came into effect at 8 a.m. Beijing Time on April 8, expired at 8 a.m. Beijing Time on April 22, 2026. The ceasefire was extended without a set timeline. Iran believes this move is to buy time for a surprise attack. The Iranian military stated, "The Iranian Armed Forces are fully prepared for war at 100 percent readiness, ready to open fire at any time. Once any aggression or action is taken against Iran, Iran will immediately strike set targets with strong power, giving the United States and Israel a more severe lesson than before." Last night, U.S. President Trump also said that if an agreement was not reached before the ceasefire expired, extending the ceasefire "is highly unlikely," and that a military operation against Iran would be immediately resumed. Due to the U.S. excessive demands and the announcement of a maritime blockade, which has hindered further negotiations, Iran has clearly lost trust in the United States and is fully prepared for the possible resumption of hostilities. Reports say that Iran has believed for the past two weeks that the possibility of a resumption of hostilities is very high, and has made some military movements accordingly, while preparing a new list of target strike plans. Iran is ready, and if a potential conflict breaks out, will create another "hell" for the United States and Israel from the very first second. Meanwhile, U.S. Chairman of the Joint Chiefs of Staff, General Campbell, said on Tuesday that the U.S. is ready to resume large-scale operations against Iran within a short period of time.

On Tuesday evening, it was reported that due to the continuous attacks by Ukrainian drones on ports and oil refining facilities, combined with the interruption of crude oil transportation through the last Druzhba pipeline passing through Ukraine, Russia's crude oil production in April was reduced by about 300,000 to 400,000 barrels per day compared to the average level at the beginning of the year. In addition, due to the transportation disruption caused by the Iran-US conflict in the strait, several third-party organizations and traders have stated that the loss of crude oil supply could reach 9 to 10 billion barrels before the situation returns to normal. This number will continue to accumulate as the Strait of Hormuz remains closed, and the supply loss could reach as high as 18 billion barrels if the blockade continues until mid-May, which would lead to a severe crude oil supply shortage. According to a report from Iran on the 21st, Iran stated that after the United States violated the ceasefire agreement, the entry and exit channels of the Strait of Hormuz have been blocked, and all navigation is strictly controlled by the Iranian Islamic Revolutionary Guard Corps Navy. Before obtaining a complete guarantee to lift the maritime blockade on Iran, no ships will be allowed to pass through the strait. Previously, Trump emphasized that he would not lift the maritime blockade on Iran before reaching a nuclear agreement.

Overall, although the ceasefire has been extended, it has not helped restore navigation through the Strait of Hormuz, and expectations of rising oil prices have already begun to intensify. From Iran’s perspective, the U.S. blockade of Iranian maritime transport has indeed dealt a blow to Iran’s economy; however, the U.S. has simultaneously placed itself in a passive position—conceding would be perceived by Iran as an admission of defeat, further emboldening Tehran. If geopolitical tensions escalate—a possibility increasingly likely—this could combine with supply disruptions to drive oil prices sharply higher, rendering all prior efforts to stabilize oil prices futile—a scenario Trump is keen to avoid. Tight crude supply in Q2 remains a deterministic fundamental backdrop, providing solid downside support for oil prices. Recent sharp declines may present appropriate opportunities for selective accumulation at lower levels. Given the high volatility and substantial market uncertainty, enhanced risk management and cautious participation are advised.

II. Macroeconomic Dynamics

1、Trump announced the extension of the ceasefire on Tuesday local time.Maintain the naval blockade and wait for Iran to submit a unified negotiation proposal.

2. Iranian media responds to Trump's extension of the ceasefire period:Israel did not request an extension of the ceasefire period.; An advisor to the Iranian parliament speaker said that Trump's move is meaningless, and a continued blockade is equivalent to bombing; the Iranian armed forces responded: if attacked, they will immediately strike predetermined targets with great force.

3、Iran has ultimately decided not to attend the U.S.-Iran talks scheduled for the 22nd.US media: Vance cancels trip to Pakistan.

4. Hezbollah of Lebanon stated it attacked Israeli military targets in response to Israel's violation of the ceasefire.

5、Fed Chair nominee Walsh: The Fed needs to develop a new framework to address inflation.。

6. Trump: I would be disappointed if the new Federal Reserve chair does not cut interest rates; I was surprised by the U.S. stock market rebound during the Iran conflict—I had expected it to drop by 20%.

7. Japan officially approved the export of lethal weapons through a cabinet resolution.

8. OpenAI launched the ChatGPT Images 2.0 image model.

9. To crack down on “hoarding and profiteering,” the Ministry of Industry and Information Technology (MIIT) will guide memory chip manufacturers to strengthen channel management.

10. Ministry of Industry and Information Technology (MIIT)Support forward-looking research on space-based computing power technologies and systematically advance R&D in cutting-edge technologies such as 6G and the next-generation internet.

11. CATL released its third-generation SCIENCE ultra-fast charging battery, and sodium battery will achieve mass production this year.

Domestic oil prices have been cut for the first time this year, saving 22 yuan for a full 50-liter tank of 92-octane gasoline.

III. Early Morning Dynamics of the Plastic Market

Oil prices surge! Main domestic plastic futures contracts are all in the red.

The PTA Futures Contract 2609 is quoted at 8,043 RMB/ton, up 1.25% from the previous trading day.

The PP2609 contract was quoted at RMB 8,264 per ton, up 0.95% from the previous trading day.

PVC2609 contract was quoted at 5175 yuan/ton, up 0.96% from the previous trading day.

The benzene styrene futures contract 2605 was quoted at RMB 9,909 per ton, up 2.37% from the previous trading day.

IV. Market Forecast

PE: Geopolitical tensions remain unresolved, with the second round of U.S.-Iran negotiations still lacking substantive progress. Navigation through the Strait of Hormuz continues to face challenges, disrupting overseas cargo transportation and fueling industry concerns over the stability of overall raw material and supply availability. Domestically, production facilities remain under pressure, with multiple PE production units undergoing maintenance. Imported supply available in the spot market remains limited, keeping overall supply tight. In contrast, downstream demand remains weak: end-user enterprises face high finished-goods inventory levels, exhibit low willingness to replenish production stocks, and restrict procurement to only essential, basic requirements—without any concerted restocking activity. Currently, the market lacks significant bullish or bearish catalysts to drive price movements; there are no new triggers to stimulate market activity. As a result, both buyers and sellers are adopting a wait-and-see stance, and actual physical trading activity remains persistently sluggish. Overall, the supportive effect from tight supply is offset by weak demand, resulting in a balanced bullish-bearish dynamic. In the near term, the polyethylene market is unlikely to experience sharp upside or downside moves and will most likely trade within a narrow range; the subdued trading atmosphere is also unlikely to improve rapidly.

PP: Recently, the polypropylene market has been in a state of balance between bullish and bearish factors, with the market overall in a stagnant condition. From the cost perspective, major oil-producing countries in the Middle East have significantly cut production, combined with the disruption of navigation in the Strait of Hormuz, which has strengthened the support from the raw material side, becoming an important bullish factor in the market. However, with the start of the temporary ceasefire negotiations between the US and Iran, geopolitical risks have eased somewhat. Meanwhile, low refining plant operating rates in Asia and the expectation of continued US interest rate hikes have gradually emerged as bearish factors, exerting pressure on the market. Downstream industries have limited acceptance of current prices, resisting high-priced products, and their purchasing activities have remained cautious, mostly focusing on small-scale, urgent needs, with overall purchasing enthusiasm remaining low. Affected by the combined influences of supply and demand and macroeconomic sentiment, the futures market has shown weak performance, exhibiting a fluctuating downward trend. Overall, the current market is characterized by a struggle between cost support and weak demand, with both bullish and bearish forces relatively balanced. In the short term, the polypropylene market lacks clear directional drivers, and the market is unlikely to see significant fluctuations. It is highly probable that the market will maintain a narrow range consolidation, with spot transactions remaining light, and the overall trend being stable.

PVC: In March 2025, the export volume was 684,000 tons, an increase of 86.70% year-on-year and 52.84% month-on-month, with a monthly average export price of 651.18 USD/ton. The total export volume for January-March was 1,416,900 tons, and the total import volume was 40,800 tons. The surge in March's export volume was due to the rush to export before the cancellation of the export tax rebate, supporting the demand side. Recently, the price adjustments in both the futures and spot markets have become slightly stable. From the perspective of the spot market, supply-side, some chlor-alkali companies have begun to announce maintenance plans, and the raw materials for the ethylene-based method still face challenges. Demand has not seen significant changes, with downstream markets still having spot purchases. After a slight adjustment in the futures market today, the turnover of intermediaries' goods has decreased compared to earlier. Regarding the overseas market, the impact of the Middle East conflict on the PVC futures and spot markets is minimal. Overall, the spot price of PVC is likely to remain slightly adjusted in the short term.