Market News

At 01:58 HKT, WTI December 2026 broke below USD 96 and crossed its fifth re-escalation line in this downside alert. Brent January 2027 printed a low of 103.730, just 0.06% above its own re-escalation line of 103.667 and without a breach; SC trades until 02:30 and at 681.9 has not crossed either. EB, PP, L and BR closed at 23:00 and are excluded from this round's tests.

Breach test: WTI closed three consecutive minutes below its effective threshold of 96.070 from 01:56 (95.948 / 96.023 / 95.957), with a session low of 95.690 and a lowest minute close of 95.939, a depth of 0.44%, and a further 1.41% fall from the 22:41 alert price of 97.332. The settlement basis (-7.84%) and the alert basis (-1.41%) point the same way, and the screen price and the minute series are both below the threshold, so no instrument straddles the line and a false breach is ruled out. The last alert on the same basis was 00:51 on 3 November for Brent and 22:41 on 2 November for WTI.

Drivers and supply: The driver remains diplomatic expectation, not physical supply. Xinhua, citing IRNA on 2 November, quoted Foreign Minister Araghchi saying that indirect US talks via Qatar and Pakistan are "very intensive" and that Iran has tabled its conditions; the same statement insisted that reopening the Strait depends on Iran's conditions being accepted, with no timetable and no announcement, so the three hard criteria remain 0/3. The Brent January-February spread at 3.110 against 3.870 on the prior settlement narrowed only 0.028 this round, short of the USD 0.5 structural threshold, and the spread remains positive.

Direction: Crude downward with supply on the loose side; polyolefins and the styrene chain downward with supply tight; rubber rangebound-to-weak (RU at 19,250 in the night session, up 0.23% against settlement, the only product that has not followed). 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.

Procurement: Spot has not followed and quotations are held. Styrene in East China held at CNY 11,500/t and benzene at CNY 10,060/t on 2 November, with no major plant cutting CNY 200 or more; EB at 10,005 in the night session sits about CNY 1,500 below spot, a discount that is intact, so a futures fall must not be back-solved into a spot cut. Buy on a CFR or landed-cost basis, limited to the same grade, tax basis, delivery and payment terms, with committed volume and a validity of three days or less. Release: WTI back above 103.0788 for two comparable observations. Re-escalation: WTI 95.00 (effective 94.71 or below) and Brent 103.667 (effective 103.356 or below).

To be confirmed: Monday's settlements print at 05:00 and 06:00 and every alert level must then be recomputed; a basis switch is not a price move. Current percentages are still measured against the 30 October official settlements (WTI 104.120, Brent 113.430) and therefore span the weekend rather than a single session. SC trades until 02:30, so this is an intraday print; both crude contract expiries are still to be backfilled; all eight Eastmoney items were readable, with CL00Y at 96.46 on a continuous-contract basis, 0.42% above the December contract, and therefore not used as a benchmark.

SUNTA Market Intelligence Department