LYB

Morgan Stanley cuts Brent to $75 as Hormuz reopens and supply glut returns. Market sells energy. Hidden trade: US petrochemical and specialty chemical producers are structural beneficiaries of cheaper feedstock costs — a margin tailwind the market consistently misprices with a 1-2 quarter lag. Long US large- and mid-cap chemicals.

Iran war disrupts Persian Gulf naphtha flows, forcing Asian petrochemical plants to curtail output. US ethane-based producers face no feedstock disruption and are selling into a supply-short global market. With WTI at $101 but US ethane structurally cheap, US large-cap integrated chemical producers with ethane cracker exposure are the non-obvious beneficiary. Long US ethane-advantaged chemical producers over the next 2-6 months.