U.S. Energy Secretary Chris Wright stated on Thursday that Iran appears to have cut its oil production by 400,000 barrels per day, and with its oil storage facilities reaching full capacity, production could decline even further.

Given that Iran has already cut production by 400,000 barrels per day—with further reductions anticipated—expectations of a tightening global crude oil supply have strengthened significantly. This directly supports an upward trend in spot crude oil prices and provides strong bullish support for crude oil-related futures contracts.

As downstream products of crude oil refining, these commodities will see their cost bases significantly bolstered by rising crude oil prices. On May 7, the benchmark LPG futures contract (2607) closed down 163 RMB per ton; however, the supportive cost environment is expected to slow the pace of its decline, providing positive support for both spot and futures prices.

Crude oil serves as the primary raw material for the production of petroleum asphalt; consequently, rising crude oil prices will directly drive up asphalt production costs. On May 7, the benchmark asphalt futures contract (2607) closed down 129 RMB per ton; the cost-side support resulting from crude oil prices provides a bullish boost to both spot and futures asphalt prices.

The upstream raw materials for butadiene rubber are derived from the crude oil refining and petrochemical supply chain; thus, rising crude oil prices will elevate its production costs. On May 7, the benchmark butadiene rubber futures contract (2606) closed down 550 RMB per ton; the cost-side support acts as a bullish factor influencing its price trajectory.

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