Morning Briefing - 25 October 2024
CommoPlast
Morning Briefing
25 October 2024
Brent: $74.38 (- $0.58)
WTI: $70.19 (- $0.58)
Naphtha CFR Japan: + $7
Ethylene CFR NEA: Stable
Ethylene CFR SEA: Stable
Propylene FOB Korea: Stable
Propylene CFR China: Stable
*Data represent closing prices of the previous trading day
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International crude oil benchmarks declined for the second consecutive day on Thursday, 24 October 2024, as concerns over Middle East tensions eased and US commercial crude inventories saw a significant buildup.
According to the US Energy Information Administration (EIA), domestic crude inventories surged by 5.5 million barrels last week, surpassing market expectations. This increase was driven by record-high production levels, reaching 13.5 million barrels per day, alongside a sharp rise in imports.
Oil prices have experienced heightened volatility throughout October as traders weigh geopolitical risks to output from the Middle East, which accounts for roughly a third of global supply. Meanwhile, demand signals have remained mixed, adding to the uncertainty in the market.
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The Chinese homo-PP market has been tracking a stable trend for two straight sessions despite rising futures contracts on the Dalian Commodity Exchange, which would typically push domestic spot prices higher. The conservative pricing strategy suggests that Chinese suppliers are deliberately adopting a conservative pricing strategy, likely aimed at accelerating inventory clearance before the month-end.
Data reveals a significant decline in the combined PP and PE stocks held by Sinopec and CNPC, dropping by 80,000 tons this week and bringing total inventories below the critical 800,000-ton threshold for the first time in October.
Nevertheless, buyers here maintained a cautious stance while monitoring the upcoming National People's Congress (NPC) meeting, which is scheduled at the beginning of November.
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