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Chemical Spot Markets Retreat as Falling Crude Prices Weigh on Sentiment, TPH Says

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Chemical spot prices broadly softened last week as declining crude oil prices and growing market speculation about a potential US-Iran peace agreement weighed on sentiment across petrochemical markets. Despite the pullback, nearly all major products continued to trade well above levels seen before the outbreak of hostilities, analysts at TPH Energy Research said in a note on Tuesday.

Among the largest declines, US polypropylene prices fell 5 cents per pound to 66 cents/lb after data showed Chinese PP exports reached record highs in March and April, raising concerns over global supply.

Even so, US PP remains 23 cents/lb above pre-war levels. Market tightness has persisted due to constrained availability of propylene, with producers citing limited feedstock supplies for Asian propane dehydrogenation plants.

US methanol prices dropped $30/tonne to $511/tonne amid reports of weak spot buying interest. However, prices remain elevated, standing $176/tonne above pre-war benchmarks.

US methyl tert-butyl ether values declined 27 cents per gallon to $3.13/gal, tracking weaker gasoline markets. Despite the decrease, MTBE continues to trade $1.02/gal above pre-war levels.

In Asia, Chinese vinyl acetate monomer prices fell 7 cents/lb to 42 cents/lb, despite a planned one-month shutdown at a Singapore production facility. Market participants cited subdued downstream demand as the primary driver of the decline. Chinese VAM remains 10 cents/lb higher than pre-war levels.

Elsewhere, price movements were more modest. US polyethylene eased 2 cents/lb to 64 cents/lb, remaining 26 cents/lb above pre-war levels. US polyvinyl chloride edged down 1 cent/lb to 38 cents/lb, still 8 cents/lb above pre-war levels. Southeast Asian caustic soda prices slipped $5/tonne to $430/tonne but continued to hold a $20/tonne premium to pre-war pricing.

The latest declines suggest easing pressure across chemical markets as energy prices retreat, though supply constraints and elevated production costs continue to keep many products trading significantly above levels seen before the conflict.

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