Market News

At 00:51 HKT, Brent January 2027 and SC December 2026 both broke below their respective re-escalation lines, marking the fifth escalation for Brent and the third for SC in this downside alert. WTI approached but did not breach; EB, PP, L and BR closed their night sessions at 23:00 and are unchanged from the previous round, so they are excluded from this round's tests.

Breach test: Brent held below its effective threshold of 104.890 for 11 consecutive minutes from 00:39, touching a session low of 104.640 (0.54% depth). SC held below 687.33 for seven straight minutes from 00:40, slipped again from 00:48 and printed a low of 685.6 (0.55% depth). Both are more than one percent beyond the 22:41 alert prices in the same direction, with depth and duration both satisfied, so this is not a line-hugging wobble. WTI's low of 96.540 remains 0.49% above its effective threshold of 96.070 and does not count as a breach. Settlement-based and alert-based readings point the same way and no instrument straddles the line, so false breaches are ruled out.

Drivers and supply: The driver is still diplomatic expectation rather than physical supply: Iran's president said on 2 November that the Supreme Leader has authorised the government to negotiate (IRNA, CCTV), while the foreign ministry said implementation of the two-day plan and the restoration of security in the Strait depend on concrete US action; Trump repeated that he would strike at some point after the election. No new official text has appeared since midnight and the three hard criteria remain 0/3. The Brent January-February spread at 3.138 versus 3.870 on the prior settlement narrowed only 0.085 this round, short of the USD 0.5 structural threshold.

Direction: Crude downward with supply on the loose side; polyolefins and the styrene chain downward with supply tight; rubber rangebound-to-weak. For the next one to three sessions crude is seen 45% down, 40% up and 15% sideways (model estimates, not a traded-market guarantee). The 3 November midterm vote and the window for renewed strikes from 4 November keep risk two-way, so no high single-direction probability is assigned.

Procurement: Spot has not followed and quotations are held. On 2 November styrene in East China held at CNY 11,500/t and benzene at CNY 10,060/t, no major plant cut by CNY 200 or more, and EB's discount of about CNY 1,500 to spot is intact: a futures fall must not be back-solved into a spot cut. Buy on a CFR or landed-cost basis, scale in on further weakness, limited to the same grade, tax basis, delivery and payment terms, with committed volume and a validity of three days or less. Release: Brent back above 112.2957 and SC above 737.7, each for two comparable observations. Re-escalation: Brent 103.667 (effective 103.356 or below) and SC 679.24 (effective 677.20 or below).

To be confirmed: Once the 2 November settlements print at 05:00 and 06:00, every alert level must be recomputed on the new basis, and a basis switch is not a price move. The 09:00 open on 3 November must be tested against the night close so the night fall is not double-counted. SC trades until 02:30, so this remains an intraday print; both crude contract expiries are still to be backfilled; all eight Eastmoney items were readable, with CL00Y at 96.59 on a continuous-contract basis and therefore not used as a comparison basis.

SUNTA Market Intelligence Department