Morning Briefing - 03 Feb. 2026
CommoPlast
Morning Briefing
03 February 2026
Brent: $66.30 (- $3.02)
WTI: $62.14 (- $3.07)
Naphtha CFR Japan: - $15
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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Weaker futures weighed on Chinese polyolefin market as February starts
The Chinese PP and PE markets lost momentum at the start of February as a sharp retreat in futures prices curtailed arbitrage-led buying and dampened spot market activity.
The most actively traded PP and LLDPE contracts on the Dalian Commodity Exchange closed CNY 141/ton ($20/ton) and CNY 154/ton ($22/ton) lower, respectively, amid a broad sell-off across equities and base metals. The downturn in futures pricing quickly filtered into physical markets, prompting buyers to step back from negotiations.
The pullback also coincided with the onset of Spring Festival travel, reinforcing expectations of a swift slowdown in downstream manufacturing. Against this backdrop, market participants increasingly questioned the durability of the recent price recovery, with some viewing the January upswing as having already peaked.
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Oil fell more than 4% on de-escalated Iran risks, deepened commodity sell-off
Global crude oil benchmarks fell by more than 4% on Monday, 2 February, as easing geopolitical risks surrounding Iran weighed heavily on market sentiment. Prices retreated after the US signalled it was engaged in talks with Tehran, pointing to a potential de-escalation of tensions with the OPEC producer.
The decline was amplified by a stronger US dollar and a sharp sell-off across the wider commodities complex, accelerating fund-driven liquidation. Market participants said the abrupt reversal has shifted momentum decisively lower.
Industry sources warned that prices at current levels could prompt fresh selling by trend-following commodity trading advisors, adding to downside pressure. Further liquidation is expected if Brent slips below the $65/bbl threshold, where substantial options open interest could intensify volatility and exacerbate price swings.
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