On June 26, the international crude oil market experienced a rare single-day plunge. Light sweet crude oil futures for August delivery on the New York Mercantile Exchange settled at $69.23 per barrel, down 3.74%, while Brent crude oil futures for August delivery on the London ICE Futures Exchange fell 4.34% to close at $71.99 per barrel. During the session, Brent crude briefly dipped below $72, and WTI crude touched a low of $68.47, with intraday declines exceeding 4% at peak.
For the textile industry, this price signal is far from an isolated event. Crude oil is the upstream origin of the chemical fiber chain, from naphtha to PX, then to PTA and polyester filament, with each step's cost transmission heavily dependent on oil price trends. This plunge suggests that chemical fiber feedstock prices, which have remained elevated due to recent oil volatility, may face a rapid revaluation.
Cost Transmission Logic and Industry Impact
According to public data from the General Administration of Customs of China, synthetic fiber-related products accounted for over 35% of China's textile raw material imports in the first five months of 2025. For products like polyester filament, polyester staple fiber, and nylon, petroleum-based raw materials constitute 60%-70% of total costs. For every $1/barrel drop in crude oil, PTA production costs theoretically decrease by approximately 30-40 RMB/ton, while polyester filament costs fall by 50-60 RMB/ton.
In major chemical fiber production clusters such as Xiaoshan (Zhejiang), Shaoxing, and Shengze (Jiangsu), traders have begun lowering quotes for polyester chips and polyester filament. Industry sources indicate that on the morning of June 27, mainstream quotes for polyester POY 150D/48F in East China dropped by 100-150 RMB/ton compared to the previous day, with some mills suspending price listings and adopting a case-by-case negotiation strategy. This wait-and-see attitude is typical of the initial phase of cost collapse—upstream players hesitate to set prices, while downstream buyers wait for lower entry points.
For fabric buyers, this presents a noteworthy procurement window. Typically, after a crude oil crash, chemical fiber feedstock prices follow suit within 3-7 days, but the pace varies by product type due to inventory cycles and order structures. Polyester filament, given its high production concentration and strong pricing power of major mills, tends to adjust faster than polyester staple fiber or viscose. Nylon, with thinner margins in the caprolactam stage, may see more moderate declines.
Medium-Term Uncertainty: OPEC+ and Demand Dynamics
However, a single-day plunge does not necessarily signal a downtrend. The current crude oil market faces multiple contradictions. On one hand, major OPEC+ producers have recently signaled possible adjustments to production cuts; if output increases materialize, oil prices could face further pressure. On the other hand, global manufacturing PMI data suggests that economic recovery momentum in Europe and the US is weakening, but crude demand in Asia—especially China and India—is slowly recovering.
For Chinese textile export enterprises, lower oil prices reduce production costs but may also cast shadows over orders. If persistent oil weakness is interpreted as a leading indicator of global economic slowdown, overseas brands and retailers might delay replenishment plans, potentially impacting textile and apparel export orders in the second half of the year. From January to May 2025, China's textile and apparel exports grew by approximately 4.7% year-on-year, but the growth rate for exports to the EU narrowed from 6.3% in the first two months to 4.1%, indicating that external demand resilience is being tested.