Middle east situation adds new uncertainty! crude oil surge ignites market! polyethylene, polypropylene, and styrene futures rally collectively

I. Overnight Crude Oil Market Dynamics

Persistent disruptions in the Strait of Hormuz have heightened supply risks, and market doubts about the prospects of U.S.-Iran negotiations have driven international oil prices higher. NYMEXCrude oil futuresThe May contract rose by $5.16/barrel, or +5.46% month-over-month, to $99.64; ICE Brent crude futures May contract increased by $4.56/barrel, or +4.22% month-over-month, to $112.57. China's INE crude futures May 2026 contract rose by 12.1 to 740.5 yuan/barrel, and gained 19.8 to 760.3 yuan/barrel in the night session.

Future market forecast

II. Macro Dynamics

1. Source: The Senate hearing for Federal Reserve Chair nominee Walsh is expected to be held as early as the week of April 13.

2. Fox Poll:U.S. voters' dissatisfaction with Trump hits a record high.。

3. Vance wins the 2028 presidential straw poll at the Conservative Political Action Conference.

4. Trump and Modi discussed the situation in the Middle East in a call, with Musk participating.

5. According to TASS: Russia has decided to impose measures on its domestic oil producers from April 1 to July 31.Gasoline export ban。

6. Zelenskyy: Ukraine has reached defense cooperation agreements with Saudi Arabia, Qatar, and the UAE, involving joint drone production and other areas.

Deputy Prime Minister Han: Considering activating the Level 3 resource crisis response when oil prices rise.

8. A U.S. official revealed that the United States permitted a Russian oil tanker to dock in Cuba.

Libya's Sharara oil field is expected to resume normal production levels within 48 hours.

10. The President of Switzerland: The trade negotiations between Switzerland and the US will continue beyond March.

11. Germany adopts the 2026 Climate Protection Plan with multiple measures to promote emission reduction.

12. Tesla plans to double the size of its service center network in Japan.

WTO discusses extending the moratorium on tariffs on electronic transmissions for five years.

14. Iran situation - ① Iranian Speaker of the Parliament:The so-called “news” before market open is merely a trap set for profit-taking.，It is a reverse indicator。

Iran releases satellite images of destroying a U.S. E-3 warning aircraft.

On weekends, Israel attacked two aluminum plants related to the United States in Bahrain.

④ Foreign Minister of Pakistan:Aiming to host the Israel–UAE peace talks in the coming days。

⑤ The number of U.S. troops stationed in the Middle East has exceeded 50,000.

⑥ The Houthis claimed they struck a key Israeli military target.The relevant military operations will continue for some time into the future.

15. Situation in the Strait of Hormuz — ① Malaysia stated that Iran has allowed Malaysian oil tankers stranded in the Strait of Hormuz to pass through.

② Thailand has reached an agreement with Iran regarding the passage of its oil tankers through the Strait of Hormuz.

Two more liquefied petroleum gas tankers have left the Persian Gulf through the Strait of Hormuz bound for India.

④ Pakistan says Iran has agreed to allow another 20 of its ships to pass through the Strait of Hormuz.

China has achieved the large-scale production of medical-grade alpha isotopes at the curie level for the first time.

17. DDR5 memory prices have dropped, and experts say that prices will continue to decline, though over a longer time span.

The People's Bank of China convened the 2026 Financial Stability Work Conference: Continuously curbing incremental financial risks and deepening the reform of key financial institutions.

Minister of Commerce Wang Wentao met with EU Commissioner for Trade and Economic Security Valdis Dombrovskis.

Wang Yi held a phone call with the Vice Prime Minister and Foreign Minister of Pakistan, and both sides agreed to jointly promote ceasefire, cessation of hostilities, and resumption of talks.

21. The Ministry of Commerce and China Export & Credit Insurance Corporation jointly issued the “Notice on Giving Full Play to the Role of Export Credit Insurance to Promote a Strong Start for High-Quality Development during the 15th Five-Year Plan Period.”

The Chinese Ministry of National Defense dispatched a delegation to Europe for institutionalized dialogue.

The Ministry of Commerce has initiated two trade barrier investigations into U.S. practices and measures that undermine the global supply chain and hinder the trade of green products.

Han Zheng: Promote the deep alignment of the "Belt and Road" cooperation with South Africa's national development plans, and tap the potential for pragmatic cooperation in various fields.

III. Morning Market Dynamics for Plastics

International oil prices rise! The main domestic plastic futures contracts are all in the red.

Polyester 2605 contract quoted at 8990 yuan/ton, up 2.15% from the previous trading day.

PP2605 contract was quoted at 9493 yuan/ton, up 2.86% from the previous trading day.

The PVC2605 contract was reported at 5677 yuan/ton, up 1.12% from the previous trading day.

Styrene May 2026 contract closed at RMB 10,660 per ton, up 2.20% from the previous trading day.

Four, Market Forecast

PE: China’s polyethylene market prices continued to consolidate at relatively strong levels. Geopolitical risks provided robust cost support, while plant maintenance activities offered multiple positive impacts on prices. To maintain healthy inventory levels and cash flow, traders adjusted prices moderately amid favorable funding conditions, and end-users purchased opportunistically on dips, resulting in a sequential increase in the transaction index. In the short term, scheduled cost-driven and planned maintenance activities are expected to proceed as anticipated, with limited unexpected supply-side changes. Coupled with end-user restocking demand amid peak-season production, and guidance from low-price transactions, polyethylene prices are expected to remain relatively strong in consolidation, with price fluctuations around RMB 50/ton.

PP: Supply and demand for polypropylene have shifted from oversupply to undersupply, with the supply-demand gap turning negative, providing support to market prices. The negative supply-demand gap is expected to continue expanding, with tight supply providing strong support to market prices. With the US releasing signals of dialogue and easing, market concerns about crude oil supply risks are expected to ease, and cost support may weaken. Currently, the capacity utilization rate of production enterprises remains low, and the concentration of facility maintenance continues to tighten the supply side. Downstream demand shows resistance to high-priced products, and market inquiry activities are quiet, with traders maintaining an observational stance. It is expected that the polypropylene market will remain in a high-range fluctuation.

PVC: The domestic PVC spot market has been fluctuating in a weak range recently due to market sentiment. The cost pressure supports the high level of ethylene-based PVC, while the electrocyclic method is in a tug-of-war between increasing supply and flat short-term demand. Meanwhile, the recent easing of global regional conflicts has led to a recent oscillation and bottom-seeking trend in the futures market. In the short term, global PVC supply has seen regional reductions, and the domestic supply and demand are relatively balanced. It is expected that the electrocyclic PVC market will maintain a small range adjustment trend.