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Morning Briefing - 03 Mar. 2026US–Iran tensions have abruptly repriced China’s polyolefins complex and the wider upstream sector, embedding a fresh risk premium. |
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CommoPlast
Morning Briefing
03 March 2026
Brent: $77.74 (+ $4.87)
WTI: $71.23 (+ $4.21)
Naphtha CFR Japan: (+ $79)
Ethylene CFR NEA: (+ $40)
Ethylene CFR SEA: (+ $30)
Propylene FOB Korea: (+ $10)
Propylene CFR China: (+ $10)
*Data represent closing prices of the previous trading day
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Chinese polyolefins reprice sharply as geopolitical premium bites
US–Iran tensions have abruptly repriced China’s polyolefins complex, embedding a fresh risk premium across PP and PE as futures on the Dalian Commodity Exchange locked limit-up, validating aggressive spot hikes and shifting sentiment from routine restocking to defensive positioning.
Homo-PP advanced CNY 150-300/ton after futures surged CNY 396/ton. Sellers withheld fresh offers in anticipation of further upside, while converters moved decisively to secure near-term coverage at elevated levels. In PE, LDPE spearheaded the rally, followed by HDPE and LLDPE.
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Naphtha surges to multi-month high as Strait of Hormuz closure tightens feedstocks
Naphtha has vaulted to its highest level since July 2024 as the closure of the Strait of Hormuz injects a pronounced geopolitical premium into feedstocks. Since late December 2025, prices have climbed by nearly 34%. The rally accelerated after Iran warned it would target vessels transiting the waterway, a corridor that handled roughly 20% of global crude flows and 25% of LNG trade.
This is more than headline-driven volatility. Crude’s spike is mechanically lifting naphtha, but Asia’s structural exposure to Middle Eastern supply amplifies the risk. Japan and South Korea source around 90% and 80% of their crude from the region, respectively. Any sustained disruption would tighten refinery operations in both countries, constraining naphtha output.
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