Since the outbreak of the Iran-Israel conflict, overseas geopolitical tensions have continued to disrupt global energy and chemical markets, exacerbating volatility in raw material prices and triggering a strong rally in the aromatic hydrocarbon industry chain. Combining the price trends of key chemical products such as Toluene, Benzoic Acid, Propionic Acid, Caustic Liquid (32%), and Acetic Acid (as shown in the chart below), we can clearly observe the profound impact of the conflict on supply chains and market expectations.

 I. Abnormal Price Fluctuations Driven by the Conflict

As seen in the price trend chart, after the conflict escalated in March 2026, prices of core chemical products saw a sharp surge around March 9, with aromatic hydrocarbons showing particularly notable gains:

1. Toluene: As a core variety in the aromatic hydrocarbon industry chain, its price jumped rapidly from USD788.61 /ton at the end of February (28-Feb) to USD1251.39/ton on March 9, a single-day increase of over 58.7%. Although it corrected afterward, it remained in a high range of USD1062-1145/ton, directly reflecting the impact of tightened aromatic supply and surging oil-blending demand.
2. Benzoic Acid: Its price surged from USD883.21/ton at the end of February to USD1386.86/ton on March 9, an increase of over 57%. Its trend is highly correlated with Toluene, reflecting the consistency of cost transmission in the aromatic hydrocarbon industry chain, making it the best-performing variety in this rally.
3. Propionic Acid: Affected by supply chain disruptions and supply contraction, its price climbed gradually from USD671.53/ton at the end of February to USD1080.29/ton on March 9, an increase of 60.9%, and stabilized in the range of USD1065-1080/ton afterward, further reinforcing price support through the supply contraction logic.
4. Caustic Liquid (32%): Price fluctuations were relatively mild, rising moderately from USD96.35/ton at the end of February to USD118.69/ton on March 9, and remaining in the range of USD100-119/ton afterward. It was less directly impacted by the conflict, only showing a moderate upward trend in line with energy costs.
5. Acetic Acid: Price movement was stable, climbing slowly from USD381.75/ton at the end of February to USD423.53/ton on March 13, with an overall fluctuation of less than 11%. It was minimally affected by geopolitical conflicts, mainly fluctuating slightly with energy costs.

Industry data shows that core aromatic varieties have seen a strong rally since March: PX and PTA have accumulated gains of nearly 40%, pure benzene has risen by over 45%, and styrene by over 42%. On March 12, related varieties even hit their daily limit limits in the domestic futures market, with the supply contraction logic continuing to dominate market sentiment.

 II. Analysis of Core Impact Logic

(1) Widespread Refinery Run Cuts at Home and Abroad, Significantly Tightening Aromatic Supply

The scope of refinery run cuts in Asia continues to expand, and raw material shortages have shifted from market expectations to reality. Energy supply chain disruptions caused by the conflict, combined with refinery maintenance and capacity contraction, have directly led to a sharp tightening in the supply of aromatic products, forming the fundamental support for price increases.

(2) Disruptions to Middle Eastern Refining Nodes Boost Aromatic Prices via Oil-Blending Demand

The core driver of this rally is the continuous attacks on energy facilities in the Middle East, which have damaged key refining and storage nodes in Saudi Arabia, Iran, Iraq, and other countries, leading to a substantial tightening of global refined product supply. As the main exporter of refined products globally, the Middle East has seen a triple blow of refinery shutdowns, oil depot destruction, and logistics disruptions, reducing the production and export capacity of gasoline, diesel, and jet fuel. To compensate for the oil product gap, overseas demand for aromatics for oil blending has risen passively, intensifying global competition for aromatic supplies and further pushing up prices.

(3) Sufficient Domestic Supply Resilience Benefits Integrated Leaders

Relevant data shows that about 40% of China’s imported crude oil passes through the Strait of Hormuz. Even if the channel is blocked in an extreme scenario, domestic refineries can still maintain a long-term operating load of about 80% relying on strategic reserves and diversified procurement, and the medium- to long-term growth logic of the industry remains unchanged. Leading enterprises with integrated and low-cost production capacity will continue to unlock performance elasticity during this upward cycle.

III. Market Outlook

Short-Term Perspective

Geopolitical tensions will persist, and Asian refinery run cuts and strong overseas oil-blending demand will continue to support aromatic prices. Prices of Toluene, Benzoic Acid, and other products are likely to remain high and volatile, with the supply contraction logic hard to ease in the short term. Non-aromatic products such as Caustic Liquid and Acetic Acid will see mild fluctuations due to energy cost transmission, with relatively stable overall trends.

Medium- to Long-Term Perspective

As the impact of the conflict gradually dissipates and global supply chains restructure, the industry’s supply structure will continue to optimize. Leading enterprises with integrated layouts, low-cost production capacity, and diversified procurement channels will gain an edge in market volatility and continue to unlock performance elasticity. Relying on strategic reserves and supply resilience, China’s chemical industry will maintain its medium- to long-term growth logic and is expected to consolidate its competitive position in the global market.