Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - The ongoing turmoil in the Middle East, especially the tense situation in Iran, continues to drive up the prices of energy and chemical products. The market anticipates that the conflict in Iran will escalate and may spread to neighboring countries, leading to concerns about energy supply disruptions [3]. - For PE, upstream maintenance plans are increasing, and the expected decline in the operating rate, combined with weak import resource arrivals, is tightening the market supply. Although the overall downstream operating rate has rebounded, the high - price acceptance of downstream is low, resulting in a significant decline in the L basis. However, the supply side still provides strong support, and the PE market trend remains strong [3]. - For PP, the intensification of the Iran conflict has increased concerns about raw material supply. The supply support for PP remains strong as the maintenance losses of upstream enterprises continue to rise. The high price of PP has squeezed downstream profits, leading to cautious procurement by downstream. However, the opening of the PP export window has boosted export demand. In the short term, the reduction in PP supply and the strong support from the cost side of propane will continue to drive prices up as long as the Strait of Hormuz remains closed [4]. Summary by Directory 1. Polyolefin Basis and Inter - period Structure - The closing price of the L main contract is 9,523 yuan/ton (+705), and the closing price of the PP main contract is 9,793 yuan/ton (+774). The LL North China spot price is 8,800 yuan/ton (+500), the LL East China spot price is 9,100 yuan/ton (+650), and the PP East China spot price is 9,300 yuan/ton (+550). The LL North China basis is - 723 yuan/ton (-205), the LL East China basis is - 423 yuan/ton (-55), and the PP East China basis is - 493 yuan/ton (-224) [1]. 2. Production Profit and Operating Rate - The PE operating rate is 80.1% (-2.3%), and the PP operating rate is 70.5% (+0.4%). The PE oil - based production profit is - 1,617.9 yuan/ton (-412.0), the PP oil - based production profit is - 1,557.9 yuan/ton (-412.0), and the PDH - based PP production profit is - 3,142.4 yuan/ton (-1,202.8) [1]. 3. Polyolefin Non - standard Price Difference No specific data or analysis provided in the given content. 4. Polyolefin Import and Export Profits - The LL import profit is - 962.5 yuan/ton (-150.0), the PP import profit is - 1,409.9 yuan/ton (-200.0), and the PP export profit is 179.1 US dollars/ton (+25.7) [1]. 5. Polyolefin Downstream Operating Rate and Downstream Profits - The PE downstream agricultural film operating rate is 35.4% (+8.6%), the PE downstream packaging film operating rate is 45.6% (+2.2%), the PP downstream plastic weaving operating rate is 40.3% (-0.3%), and the PP downstream BOPP film operating rate is 62.0% (+0.6%) [2]. 6. Polyolefin Inventory No specific data or analysis provided in the given content. Strategies - Unilateral: Cautiously go long on LLDPE and PP for hedging. - Inter - period: No strategy provided. - Cross - variety: Cautiously go short on the spread between LL05 and PP05 [5].

1. Report Industry Investment Rating - Not provided in the given content 2. Core View of the Report - The attack on Middle - East energy facilities has pushed up the price of propylene. The main driver of the rise in olefins is the intensification of the Middle - East conflict, which has increased concerns about raw material supply and led to an expected contraction in the olefin supply. In the short term, the supply - demand of propylene remains tight, and the price is supported as long as the Strait of Hormuz is not open to navigation [1][2] 3. Summary According to the Directory 3.1 Market News and Important Data - **Propylene**: The closing price of the propylene main contract is 8949 yuan/ton (+636), the East China spot price is 8650 yuan/ton (+350), the North China spot price is 8525 yuan/ton (+480), the East China basis is - 299 yuan/ton (-286), the Shandong basis is - 424 yuan/ton (-156), the operating rate is 71% (+0%), the difference between propylene CFR in China and naphtha CFR in Japan is 51 US dollars/ton (-7), the difference between propylene CFR and 1.2 propane CFR is - 86 US dollars/ton (-11), the import profit is - 639 yuan/ton (+90), and the in - plant inventory is 46360 tons (+2100) [1] - **Propylene downstream**: The operating rate of PP powder is 27% (-4.13%), and the production profit is - 175 yuan/ton (-80); the operating rate of propylene oxide is 76% (-1%), and the production profit is 31 yuan/ton (-368); the operating rate of n - butanol is 83% (-2%), and the production profit is 728 yuan/ton (-222); the operating rate of octanol is 88% (-3%), and the production profit is 554 yuan/ton (-96); the operating rate of acrylic acid is 72% (-5%), and the production profit is 4609 yuan/ton (-250); the operating rate of acrylonitrile is 75% (+1%), and the production profit is - 330 yuan/ton (-350); the operating rate of phenol - acetone is 87% (+1%), and the production profit is - 392 yuan/ton (-150) [1] 3.2 Market Analysis - The attack on energy facilities in the Middle East has led to concerns about energy supply interruption in the international market. The prices of crude oil and LPG have risen significantly, further driving up the prices of chemical products. The supply of propylene raw material propane has tightened again, increasing the expectation of PDH device maintenance. The demand side has been boosted by the expected reduction in propylene supply, but the weakening of the rigid demand for propylene due to the shrinking profit of some downstream products needs to be considered. In the short term, the supply - demand of propylene is still tight, and the price is supported [2] 3.3 Strategy - **Unilateral**: Cautiously go long on hedging at low prices - **Inter - period**: None - **Inter - variety**: None [3] 3.4 Figures and Data Sources - **Propylene basis structure**: Figures include the closing price of the propylene main contract, East China basis, Shandong basis, etc., with data sources from Flush and Huatai Futures Research Institute [5][6][7][13][15][16] - **Propylene production profit and operating rate**: Figures cover the difference between propylene CFR in China and naphtha CFR in Japan, propylene capacity utilization rate, PDH production profit, etc., with data sources mainly from Steel Union and Huatai Futures Research Institute [5][22][25][30][31][34] - **Propylene downstream profit and operating rate**: Figures involve the production profit and operating rate of PP powder, propylene oxide, n - butanol, etc., with data sources from Steel Union and Huatai Futures Research Institute [5][39][40][41][50][55][58][62][63] - **Propylene inventory**: Figures are about propylene in - plant inventory and PP powder in - plant inventory, with data sources from Steel Union and Huatai Futures Research Institute [5][65][66]