On March 2, global energy markets experienced significant volatility due to escalating tensions in the Middle East. Following Iran's announcement of the closure of the Strait of Hormuz, safe-haven assets such as crude oil and gold surged sharply. Concurrently, China's chemical futures market exhibited unusual divergence.

By the close, the main methanol futures contract hit the daily limit-up, settling at 2,365 yuan per ton. Related A-share methanol concept stocks, including Chitianhua, Jinniu Chemical, and Xinghua Shares, also surged by the daily limit. In contrast, urea futures, another key export product for Iran, fell by 1.14% to 1,817 yuan per ton, displaying a completely opposite trend.

Signals of prolonged conflict continued to emerge. According to reports, Iran's Supreme National Security Council Secretary, Larijani, stated on March 2 that Iran would not engage in negotiations with the United States. Previously, Iran's Islamic Revolutionary Guard Corps announced on the evening of February 28 a ban on all vessels passing through the Strait of Hormuz. Reports indicated that with the halt of traffic, including oil tankers, the strait had effectively been closed. On March 1, a tanker attempting to pass through the strait was struck and began sinking.

As a critical chokepoint for global energy transportation, the Strait of Hormuz handles 20% of the world's crude oil and 35% of global methanol seaborne trade. Its closure directly triggered sharp fluctuations in energy prices.

On the morning of March 2, international oil prices surged significantly, with Brent crude opening up 13% to break above $82 per barrel. Beyond crude oil, Iran's status as the world's second-largest methanol producer, a major methanol exporter, and the second-largest urea exporter means that regional instability has a more direct and profound impact on these commodities.

Data shows Iran is the world's second-largest methanol producer, with an annual capacity of approximately 17.16 million tons (about 9.2% of global capacity) and annual production of 9–10 million tons. 80%–90% of its output is exported, making it one of the largest methanol exporters globally. China, as the world's largest methanol consumer, relies heavily on Iranian methanol. According to data, Iran's methanol exports to China reached 8.73 million tons in 2025, accounting for 60.42% of China's total imports.

Analysis suggests that if Iran's gas-to-methanol facilities face attacks, power outages, or operational halts, production could be directly suspended. Additionally, approximately 12 million tons of methanol are shipped via the Strait of Hormuz annually; any blockade or shipping disruption would significantly impact global methanol trade. Furthermore, Iran's low-cost natural gas-based methanol production sets a global price floor. Conflict-driven increases in crude oil and natural gas prices raise global methanol production costs. Soaring war risk insurance and uncontrollable shipping expenses further elevate import costs.

Recent research highlights three pathways through which the conflict affects the methanol market: supply contraction due to potential facility shutdowns in Iran; logistics disruptions from restricted shipping in the Strait of Hormuz, affecting China's import schedules; and rising costs, as higher crude oil prices increase expenses across the industrial chain, driving up methanol futures and spot prices.

Market analysts believe the geopolitical conflict has a substantial impact on methanol, with potential for further escalation. Close monitoring is required regarding whether the conflict spreads to Iran's main methanol production area, the Asaluyeh industrial zone. Attention is also needed on potential attacks on Iran's South Pars gas field, the country's primary natural gas supply region, and the status of key ports and the strait. So far, Iran's methanol shipments in February totaled 180,000 tons, with close attention required on future shipment progress.

In stark contrast to methanol's strong performance, urea futures fell by 1.14% to 1,817 yuan per ton at the close. This divergence may stem from China's stringent "supply guarantee and price stability" policies for urea.

Iran is the world's second-largest urea exporter, with an annual capacity of 8–9 million tons and exports exceeding 4 million tons, accounting for 10%–15% of global urea trade, primarily to major agricultural nations like Brazil, Turkey, and India. Although geopolitical tensions are expected to push international fertilizer prices higher, China's domestic urea market faces policy constraints.

Analysis indicates that the conflict may reduce Iran's production and exports, and the strait's closure creates uncertainty for urea exports from other Middle Eastern countries, potentially driving international urea prices higher in the short term. However, under China's urea export quota management, the impact on domestic supply and demand is limited. Currently, during the peak agricultural demand season in China, strong demand combined with geopolitical tensions supports firm prices. Domestic urea spot prices are nearing policy-guided levels, and with the focus on supply stability and price control, further upside is limited, making chasing rallies inadvisable.

Other analysis agrees that the conflict directly impacts urea supply. Several Iranian plants have shut down due to the conflict, compounded by production halts in Egypt, creating an immediate global supply gap. This could cause international fertilizer prices to surge within a week, with the gap difficult to fill quickly. For China, while major buyers like India and Brazil may turn to Chinese suppliers, creating an export arbitrage opportunity, the current spring plowing season and focus on ensuring domestic supply mean no exports are permitted in the short term. Recent price movements are primarily sentiment-driven.

Recently, China Nitrogen Fertilizer Industry Association issued a statement addressing speculation about urea guidance prices, emphasizing that the guidance price aims to ensure supply stability and market expectations. It warned against market participants exaggerating price increase expectations, which disrupts market stability. Over the long term, urea prices are expected to remain stable. Market participants are urged to rely on official information and avoid spreading rumors to maintain market stability.