Report Industry Investment Rating - No information provided Core Viewpoints - The Asian low - sulfur fuel oil market structure has further weakened due to weak downstream marine fuel demand and a decline in the spot premium of 0.5% sulfur marine fuel oil. The spot price of Singapore 380CST high - sulfur fuel oil has decreased. The market supply is currently sufficient, but the Asian low - sulfur fuel oil market may face supply shortages from April to mid - May, after which European arbitrage cargoes will increase regional inventories. High - sulfur fuel oil is more abundant than low - sulfur fuel oil. Short - term geopolitical concerns support prices, and fuel oil will operate in a high - level oscillation. FU2605 will operate in the range of 4250 - 4450, and LU2605 will operate in the range of 4900 - 5050 [3] Summary by Directory 1. Daily Prompt - The current situation and future trends of the fuel oil market are analyzed, including market structure, price, inventory, and expected price ranges for different contracts [3] 2. Multi - Short Focus - **Likely Positive Factors**: Middle East unrest and poor strait passage [4] - **Likely Negative Factors**: The reappearance of TACO in the Trump administration and upstream crude oil being under pressure [4] - **Market Drivers**: Supply is affected by geopolitical risks, and demand is neutral [4] 3. Fundamental Data - **Fundamentals**: Weak downstream demand and a decline in the spot premium of low - sulfur fuel oil have weakened the Asian low - sulfur fuel oil market structure. The spot price of Singapore 380CST high - sulfur fuel oil has dropped to $34.67 per ton, lower than $45.50 per ton on March 23 [3] - **Basis**: The basis of Singapore high - sulfur fuel oil is $59 per ton, and that of low - sulfur fuel oil is $427 per ton, with the spot at a premium to the futures [3] - **Inventory**: Singapore's fuel oil inventory in the week of March 18 was 24.869 million barrels, an increase of 0.37 million barrels [3] - **Disk**: The price is above the 20 - day line, and the 20 - day line is upward [3] - **Main Positions**: The main position of high - sulfur fuel oil is short, with short positions decreasing; the main position of low - sulfur fuel oil is long, with long positions decreasing [3] - **Expected Price Range**: FU2605 will operate in the range of 4250 - 4450, and LU2605 will operate in the range of 4900 - 5050 [3] 4. Spread Data - No information provided 5. Inventory Data - Singapore fuel oil inventory data from January 7, 2026, to March 18, 2026, are presented, showing changes in inventory and the amount of increase or decrease [7]

Group 1: Report Industry Investment Rating - No relevant content Group 2: Core View of the Report - The risk of supply in the Middle East is continuously accumulating, and the market support remains relatively strong. The fundamentals of high - and low - sulfur fuel oils are tightening, and the market structure is operating strongly. There are potential drivers on both the supply and demand sides. If the Strait is blocked for too long, the contradiction will be more prominent after the inventory of fuel oil on land and in floating warehouses is consumed. The increase in refinery start - up rates in Russia may hedge the supply gap to some extent, but the substantial alleviation of the problem still requires the resumption of navigation in the Strait [1][2] Group 3: Summary of Each Section Market Analysis - The main contract of Shanghai Futures Exchange fuel oil futures closed down 0.4% at 4,771 yuan/ton, and the main contract of INE low - sulfur fuel oil futures closed up 0.09% at 5,641 yuan/ton. Due to the obstruction of navigation in the Strait of Hormuz and the damage to energy facilities in the Middle East, the fundamentals of high - and low - sulfur fuel oils are tightening. The situation remains tense, with the number of passing ships in the Strait of Hormuz remaining low, and the scope of attacks on energy facilities in the Middle East expanding. On the demand side, countries like Egypt and Pakistan may increase fuel oil procurement due to tight natural gas supply, and the geopolitical conflict in the Middle East increases ship fuel consumption and shifts the bunker fueling demand to ports in the Asia - Pacific region [1] Potential Increment - The potential increment comes from Russia. After the refinery start - up rate in Russia recovers, the supply of refined oil products including fuel oil has room for growth, which may hedge the supply gap to some extent. However, the substantial alleviation of the problem requires the resumption of navigation in the Strait [2] Strategy - High - sulfur fuel oil: In the short term, it is oscillating strongly with large market fluctuations. It is recommended to wait and see. Low - sulfur fuel oil: In the short term, it is oscillating strongly with large market fluctuations. It is recommended to wait and see. There are no strategies for cross - variety, cross - period, spot - futures, options [3]

1. Report Industry Investment Rating - No information provided in the content 2. Core View of the Report - The Asian low - sulfur fuel oil market is supported by multiple factors such as a significant reduction in supply from the Middle East, unfeasible European - to - Singapore arbitrage due to high freight rates, and reduced production by Asian refiners because of a lack of crude oil. The supply - side pressure continues to support fuel oil prices. The fuel oil prices are expected to remain in a high - level volatile range, with FU2605 operating between 4600 - 4750 and LU2605 between 5400 - 5550 [3] 3. Summary According to the Table of Contents 3.1 Daily Hints - The Asian low - sulfur fuel oil market is supported by multiple factors. The supply - side pressure continues to support prices, and the fuel oil prices are expected to maintain high - level volatile operations. FU2605 is predicted to run in the 4600 - 4750 range, and LU2605 in the 5400 - 5550 range [3] 3.2 Long - and Short - Term Concerns -利多 factors include the Middle East situation being turbulent and the Strait having poor passage.利空 factors are the Trump administration's TACO situation and the upstream crude oil being under pressure. The market is driven by the resonance of supply - side geopolitical risks and neutral demand [4] 3.3 Fundamental Data - **Supply**: Supply from the Middle East has significantly decreased, and European - to - Singapore arbitrage is unfeasible due to high freight rates. Asian refiners have reduced production because of a lack of crude oil. In the week ending March 11, there were no fuel oil imports from Europe for the second consecutive week, and no fuel oil arrived from Russia. The Middle East fuel oil imports in Singapore that week decreased by 80.5% to 13000 tons compared with the previous week [3] - **Basis**: The basis of Singapore high - sulfur fuel oil is 513 yuan/ton, and that of Singapore low - sulfur fuel oil is 791 yuan/ton, with the spot price at a premium to the futures price [3] - **Inventory**: Singapore's fuel oil inventory in the week of March 11 was 24.499 million barrels, a decrease of 1.25 million barrels [3] - **Market Trend**: The price is above the 20 - day moving average, and the 20 - day moving average is upward [3] - **Main Position**: The main position of high - sulfur fuel oil is short, with short positions decreasing; the main position of low - sulfur fuel oil is long, with long positions decreasing [3] 3.4 Spread Data - The previous value of the FU main - contract futures price was 4762, the current value is 4790, with a rise of 28 and an increase rate of 0.59%. The previous value of the LU main - contract futures price was 5607, the current value is 5636, with a rise of 29 and an increase rate of 0.52%. The previous value of the FU basis was 441, the current value is 513, with a rise of 71.11 and an increase rate of 16.11%. The previous value of the LU basis was 1716, the current value is 791, with a decrease of 925 and a decrease rate of 54% [5] 3.5 Inventory Data - Singapore's fuel oil inventory on December 31, 2025, was 22.659 million barrels, an increase of 0.87 million barrels. As of March 11, 2026, the inventory was 24.499 million barrels, a decrease of 1.25 million barrels [8]

Group 1: Report Industry Investment Rating - No relevant content Group 2: Core View of the Report - Last week, affected by geopolitical factors, fuel oil fluctuated at a high level in sync with crude oil. High - sulfur fuel oil closed at 4,736 yuan/ton, up 19.23% for the week, and low - sulfur fuel oil closed at 5,584 yuan/ton, up 24.42% for the week. The market structures of both low - sulfur and high - sulfur fuel oil have further strengthened. International crude oil prices are expected to fluctuate sharply and rise, and fuel oil prices are expected to continue to fluctuate and rise with the market. For high - sulfur fuel oil, short - term long positions can be taken in the range of 4,450 - 4,900, and for low - sulfur fuel oil, short - term long positions can be taken in the range of 5,350 - 6,000 [5] Group 3: Summary by Directory 1. Weekly View - Geopolitical factors caused fuel oil to fluctuate at a high level with crude oil last week. The prices of high - sulfur and low - sulfur fuel oil increased significantly. The market structures of low - sulfur and high - sulfur fuel oil strengthened. For low - sulfur fuel oil, the supply shortage worry intensified due to the closure of the European arbitrage window and reduced refinery processing rates. For high - sulfur fuel oil, the supply interruption worry increased because of the blockade of the Strait of Hormuz. It is expected that fuel oil prices will continue to fluctuate and rise with the market, and specific short - term long - position operation ranges are given [5] 2. Futures and Spot Prices - **Futures prices**: The FU main contract price rose from 3,673 to 4,527, an increase of 854 or 23.26%. The LU main contract price rose from 4,123 to 5,245, an increase of 1,122 or 27.23% [6] - **Spot prices**: The prices of舟山 high - sulfur fuel oil,舟山 low - sulfur fuel oil,新加坡 high - sulfur fuel oil,新加坡 low - sulfur fuel oil, and中东 high - sulfur fuel oil decreased, with decreases of - 2.00%, - 7.21%, - 5.24%, - 11.06%, and - 3.97% respectively. The price of新加坡 diesel increased by 18.19% [7] 3. Fundamental Data - **Consumption data**: There are charts showing the consumption of Singapore fuel oil, Chinese fuel oil, and Shandong fuel oil coking margin from 2021 - 2025 [8][9][10] 4. Inventory Data - Singapore fuel oil inventory data from 2025 - 12 - 31 to 2026 - 03 - 11 are provided, including inventory volume and its changes. There are also charts about the Singapore fuel oil inventory seasonal chart and the Zhoushan Port fuel oil inventory trend [11][12][13] 5. Spread Data - There is a chart showing the spread between high - sulfur and low - sulfur futures [15]

Report Industry Investment Rating - Not provided in the content Core Viewpoints - Due to the blockade of the Strait of Hormuz, fuel oil supply from the Middle East is restricted, intensifying concerns about recent market supply disruptions. The market structures of Asian high - sulfur and low - sulfur fuel oil have further strengthened, and the spot price spread of fuel oil has reached a high. Terminal marine fuel demand is strong, and buyers are stocking up before short - term price increases. The market is in a supply shortage state. [3] - Middle East tensions have worsened, some oil - producing countries are starting to cut production passively, market sentiment is high, and enterprises are hoarding. Fuel oil prices are expected to rise in the short term, with high - sulfur and low - sulfur fuel oil expected to hit the daily limit today. The FU2605 contract is expected to run in the 4500 - 4549 range, and the LU2605 contract in the 5000 - 5032 range. [3] - The market is driven by the resonance of supply affected by geopolitical risks and neutral demand. [4] Summary by Directory 1. Daily Prompt - **Futures Market**: The previous FU and LU主力合约期货 prices were 3888 and 4376 respectively, and the current values are 4437 and 4999, with increases of 549 (14.12%) and 623 (14.24%) respectively. The previous FU and LU basis were 578 and 884, and the current values are 1581 and 1865, with increases of 1002.53 (173.31%) and 981 (111%) respectively. [5] - **Spot Market**: The previous prices of Zhoushan high - sulfur fuel, Zhoushan low - sulfur fuel, Singapore high - sulfur fuel, Singapore low - sulfur fuel, Middle - East high - sulfur fuel, and Singapore diesel were 790, 850, 646.6, 765.5, 548.92, and 1110.92 respectively. The current values are 1110, 1200, 877.87, 989.37, 772.77, and 1129.41, with increases of 320 (40.51%), 350 (41.18%), 231.27 (35.77%), 223.87 (29.24%), 223.85 (40.78%), and 18.49 (1.66%) respectively. [6] 2. Multi - and Short - term Concerns - **Likely to be Bullish**: Middle East tensions and poor channel traffic [4] - **Likely to be Bearish**: The Trump administration's TACO situation and upstream crude oil being under pressure [4] 3. Fundamental Data - **Supply and Demand**: The blockade of the Strait of Hormuz has restricted fuel oil supply from the Middle East, and terminal marine fuel demand is strong, with the market in a supply shortage state [3] - **Basis**: The basis of Singapore high - sulfur fuel oil is 578 yuan/ton, and that of Singapore low - sulfur fuel oil is 700 yuan/ton, with the spot price higher than the futures price [3] - **Market Trend**: The price is above the 20 - day line, and the 20 - day line is upward [3] - **Main Position**: High - sulfur main positions are short, with short positions decreasing; low - sulfur main positions are short, changing from long to short [3] 5. Spread Data - A chart of the high - and low - sulfur futures price spread is provided, but specific data is not detailed [9] 6. Inventory Data - Singapore fuel oil inventory on March 4, 2026, was 2574.9 million barrels, an increase of 187 million barrels. Historical inventory data from December 24, 2025, to March 4, 2026, is also provided. [3][7]

1. Report Industry Investment Rating No information provided in the document. 2. Core Viewpoints of the Report - In 2026, oil prices will still be constrained by a weak but gradually tightening supply - demand balance. OPEC+ may manage production prudently. Geopolitical tensions will maintain a risk premium on oil prices, but price increases are often short - lived. Brent oil prices are expected to fluctuate widely around $70 per barrel in the first half of 2026 and in the range of $60 - 70 per barrel in the second half [3][194][234]. - For fuel oil, the continuous increase in production by OPEC+ brings double negative effects to high - sulfur fuel oil, but geopolitical disturbances offset the negative effects. High - sulfur fuel oil shows short - term supply reduction and medium - long - term supply increase, with continuous demand reduction. Future fuel oil prices are expected to fluctuate in the range of 2,400 - 3,200 yuan per ton [4][196][237]. - For asphalt, although the US sanctions on Iran and Venezuela are intensifying, the crude oil production of these two countries is growing steadily. The supply of asphalt may be adjusted due to the reduction of small - capacity refineries, and the demand is expected to maintain a low growth rate. Future asphalt prices may continue to decline, but are expected to fluctuate in the range of 3,100 - 3,400 yuan per ton in the near term [5][197][237]. 3. Summary by Directory 3.1 First Part: Industrial Chain Analysis 3.1.1 Crude Oil Industry Chain and Price Influencing Factors - Crude oil can be classified by composition, specific gravity, and sulfur content. The industrial chain is divided into upstream (exploration, extraction, and processing), mid - stream (primary and secondary processing), and downstream (refining into various products for different uses) [13][14][15]. - Price influencing factors include demand, supply, geopolitics, and market speculation [20][22]. 3.1.2 Fuel Oil Industry Chain and Price Influencing Factors - Fuel oil is a heavy - oil product in the middle of the industrial chain, composed of upstream refineries, mid - stream service providers, and downstream end - users. It can be classified in multiple ways and is mainly used in transportation, refining, and power generation [23][24]. - Price influencing factors include international crude oil price fluctuations, the global shipping market, the supply - demand situation in the Singapore market, environmental protection requirements, and exchange rates [29][30]. 3.1.3 Asphalt Industry Chain and Price Influencing Factors - Asphalt is a product of crude oil processing. The industrial chain includes upstream raw material suppliers, mid - stream production enterprises, and downstream application fields such as roads and construction [33]. - Price influencing factors include the macro - economy, crude oil prices, road construction, and seasonal factors [34][38]. 3.2 Second Part: Introduction to Crude Oil - Related Futures and Option Contracts 3.2.1 Crude Oil Futures and Option Contracts and Delivery Systems - Crude oil futures contract: trading unit is 1,000 barrels per lot, with specific trading rules and delivery requirements [39]. - Crude oil option contract: contract type includes call and put options, with detailed trading rules and exercise price settings [42]. 3.2.2 Fuel Oil Futures Contract and Delivery System - The trading unit is 10 tons per lot, with specific trading rules and delivery requirements for RMG 380 marine fuel oil [53]. 3.2.3 Asphalt Futures Contract and Delivery System - The trading unit is 10 tons per lot, with specific trading rules and delivery requirements for 70 - grade A road petroleum asphalt [57]. 3.3 Third Part: Market Review 3.3.1 Historical Market Review - From 2020 - 2025, crude oil, fuel oil, and asphalt prices fluctuated significantly. Crude oil prices were affected by the global economic recovery, geopolitical tensions, and OPEC+ production cuts; fuel oil and asphalt prices mainly followed crude oil price fluctuations [67]. 3.3.2 2025 Market Review - Crude oil prices showed a "rush up and fall back, wide - range shock" pattern. Fuel oil prices trended downward in a shock, and asphalt prices fluctuated widely [79][83][84]. 3.3.3 Futures Trading Volume and Open Interest - In 2025, the cumulative trading volume of crude oil futures was 38,882,241 lots, with a monthly average of 3,240,186 lots; the cumulative trading volume of fuel oil futures was 192,087,708 lots, with a monthly average of 16,007,309 lots; the cumulative trading volume of asphalt futures was 83,617,090 lots, with a monthly average of 6,968,090 lots [89][90][95]. 3.4 Fourth Part: Analysis of the Crude Oil Industry Supply Pattern 3.4.1 Crude Oil Supply Analysis - OPEC+ production: The previous production cuts started in October 2022. In 2025, OPEC+ began to exit the production - cut cycle and planned to increase production gradually [96][100]. - US production: US crude oil supply in 2025 was relatively abundant, with high production levels and limited growth momentum [101][103]. 3.4.2 Fuel Oil Supply Analysis - In 2025, domestic fuel oil supply was at a low level in recent years. Singapore's fuel oil inventory increased, and regional supply was differentiated. High - sulfur fuel oil cracking spreads were affected by multiple factors [106][113]. 3.4.3 Asphalt Supply Analysis - Since 2020, China's asphalt production has declined. In 2025, domestic asphalt supply showed a structurally surplus pattern. The开工 rate was affected by seasonality, and imports and exports had certain trends [116][118][125]. 3.5 Fifth Part: Analysis of the Crude Oil Industry Consumption Pattern 3.5.1 Macroeconomic Analysis - Trump's energy new policy 2.0 may restructure the demand for oil and shipping. The PMIs of the US and Europe are below the boom - bust line, and the global economy faces risks such as geopolitics, inflation, and monetary policy [126][133]. 3.5.2 US Crude Oil Demand Analysis - In 2025, US crude oil demand growth was mainly driven by NGLs/LPG. In 2026, US crude oil demand is expected to increase by about 110,000 barrels per day year - on - year [140][142]. 3.5.3 China Crude Oil Demand Analysis - In 2025, China's crude oil demand growth was led by naphtha. In 2026, China's crude oil demand growth rate is expected to be the same as in 2025 [148][149]. 3.5.4 Fuel Oil Demand Analysis - In 2025, shipping market freight indices were relatively stable. The demand for high - sulfur fuel oil was affected by factors such as the Russia - Ukraine conflict, refinery procurement, and Middle - East power generation demand. Singapore's fuel oil inventory was at a relatively high level [152][154][161]. 3.5.5 Asphalt Demand Analysis - Domestic asphalt demand is mainly in the road and waterproofing directions. In 2025, the apparent consumption of petroleum asphalt increased. In the "15th Five - Year Plan" period, asphalt demand may maintain a low growth rate [169][176][177]. 3.6 Sixth Part: Summary and Analysis of the Crude Oil Industry Supply - Demand Situation 3.6.1 Crude Oil Supply - Demand Balance Analysis - In 2026, global oil supply is expected to slightly exceed demand. The demand of OPEC+ member countries in 2025 and 2026 has been adjusted downward compared with the previous month's assessment [188]. 3.6.2 Asphalt Supply - Demand Balance Analysis - Trump's expected promotion of the resolution of the Russia - Ukraine conflict may suppress asphalt cracking spreads. The supply side may change structurally, and demand is expected to maintain a low growth rate. Asphalt prices may continue to decline [193]. 3.7 Seventh Part: Analysis and Outlook of Arbitrage Opportunities - In 2026, oil prices will be affected by supply - demand balance and geopolitics. Fuel oil prices are expected to fluctuate between 2,400 - 3,200 yuan per ton, and asphalt prices are expected to fluctuate between 3,100 - 3,400 yuan per ton [194][196][197]. 3.8 Eighth Part: Corporate Futures Hedging Cases - Downstream enterprises can lock in crude oil procurement costs through futures trading; fuel oil trading enterprises can avoid basis risk through basis contracts; asphalt enterprises can hedge inventory risks through futures [200][202][206]. 3.9 Ninth Part: Industry Enterprise Research and 2026 Outlook - Morgan Stanley predicts that Brent crude oil prices may fall to about $30 per barrel by 2027. Market participants' views on fuel oil and asphalt in December 2025 show different trends [210][213]. 3.10 Tenth Part: Technical Analysis and Outlook of Futures Prices 3.10.1 Price Seasonal Analysis - Crude oil prices perform better in April, June, and September and are more likely to decline in May and November. Fuel oil prices are affected by summer power generation and shipping demand, and asphalt prices are stronger in summer and weaker in winter [214][217][220]. 3.10.2 Technical Analysis - Brent crude oil is expected to fluctuate between $60 - 70 per barrel. Fuel oil prices may range from 2,400 - 3,200 yuan per ton, and asphalt prices are expected to maintain a relatively weak shock pattern between 3,100 - 3,400 yuan per ton [223][225][232]. 3.11 Eleventh Part: Conclusions and Operational Suggestions - The market outlook for 2026 is similar to the analysis in the seventh part, with predictions for oil, fuel oil, and asphalt prices [234][237]. 3.12 Twelfth Part: Statistics of Related Stock Prices and Price Changes - The document provides the current prices and annual price changes of stocks related to the crude oil, fuel oil, and asphalt industries as of February 26, 2026 [239][240][243].

1. Report Industry Investment Rating - No information provided 2. Core Viewpoints - The supply of Singapore fuel oil market is expected to be tight due to the Middle - East conflict restricting the arbitrage cargo volume flowing to Asia, and the downstream marine fuel demand is gradually recovering as some end - users scramble to secure regular supplies. The potential increase in demand for high - sulfur fuel oil in the power generation sector may further support the Singapore fuel oil market [3]. - The spot price of fuel oil is at a premium to the futures price. The price is above the 20 - day line, and the 20 - day line is upward. The high - sulfur main position has short positions with a decrease in shorts, while the low - sulfur main position has long positions with an increase in longs [3]. - Overnight crude oil stabilized at a high level. Although the US allowing some countries to buy Russian crude oil slightly eases supply concerns in the short term, due to the uncertain war situation and extremely low strait navigation, there is still support below the fuel oil price. The FU2605 is expected to operate in the range of 3800 - 3900, and the LU2605 in the range of 4290 - 4380 [3]. - The market is driven by the resonance of supply affected by geopolitical risks and neutral demand. The risk points include the breakdown of OPEC+ internal unity and the escalation of war risks [4]. 3. Summary by Directory 3.1 Daily Prompt - The FU2605 is expected to operate in the range of 3800 - 3900, and the LU2605 in the range of 4290 - 4380. Overnight crude oil stabilized at a high level. The US allowing some countries to buy Russian crude oil slightly eases supply concerns in the short term, but due to the uncertain war situation and extremely low strait navigation, there is still support below the fuel oil price [3]. 3.2 Long and Short Concerns - **Likely to be bullish**: The Middle - East conflict restricts the arbitrage cargo volume flowing to Asia, and the downstream marine fuel demand is gradually recovering. The potential increase in demand for high - sulfur fuel oil in the power generation sector may further support the market. The spot price is at a premium to the futures price, and the price is above the 20 - day line with the 20 - day line upward. The low - sulfur main position has long positions with an increase in longs [3]. - **Likely to be bearish**: The Singapore fuel oil inventory in the week of March 4 increased by 1870,000 barrels to 25.749 million barrels. The high - sulfur main position has short positions with a decrease in shorts. The demand side's optimism remains to be verified, and the upstream crude oil is under pressure [3][4]. 3.3 Fundamental Data - **Supply**: The Middle - East conflict restricts the arbitrage cargo volume flowing to Asia, and the market expects the supply in the Singapore region to be increasingly tight [3]. - **Demand**: The downstream marine fuel demand is gradually recovering as some end - users scramble to secure regular supplies. The potential increase in demand for high - sulfur fuel oil in the power generation sector may further support the market [3]. - **Price**: The Singapore high - sulfur fuel oil is 594.14 US dollars per ton with a basis of 349 yuan per ton, and the Singapore low - sulfur fuel oil is 642.56 US dollars per ton with a basis of 214 yuan per ton. The spot price is at a premium to the futures price [3]. 3.4 Spread Data - The FU - LU spread chart is provided, but no specific data analysis is made [9]. 3.5 Inventory Data - The Singapore fuel oil inventory in the week of March 4 was 25.749 million barrels, an increase of 1.87 million barrels [3][7].

1. Report Industry Investment Rating - Not mentioned in the provided content 2. Core Viewpoints of the Report - Singapore's high-sulfur spot window has seen a large number of high - price transactions, supporting the high - level oscillation of high - sulfur spot discounts. Geopolitical factors are the main bullish drivers. The supply of low - sulfur fuel oil has increased significantly in the short term [4]. - The trading strategy suggests a strong oscillation for unilateral trading, paying attention to geopolitical fluctuations; for arbitrage, take profit on the FU59 long - spread at high levels and pay attention to the LU near - month reverse spread; and adopt a wait - and - see approach for options [6]. 3. Summary by Relevant Catalogs 3.1 Comprehensive Analysis and Trading Strategies 3.1.1 Comprehensive Analysis - High - sulfur: Singapore's high - sulfur spot window transactions support high - level oscillation of discounts. Geopolitical and macro - disturbances persist, with fuel export restrictions and concerns in Russia and Iran. China's state - owned procurement volume increase reflects feedstock demand. - Low - sulfur: The Dangote refinery's gasoline unit maintenance delay and the full - scale recovery of Kuwait's Al - Zour refinery have led to an increase in low - sulfur supply and exports [4]. 3.1.2 Strategies - Unilateral: Strong oscillation, focus on geopolitical fluctuations. - Arbitrage: Take profit on the FU59 long - spread at high levels; pay attention to the LU near - month reverse spread. - Options: Wait - and - see [6] 3.2 Core Logic Analysis 3.2.1 High - Sulfur Fuel Oil Supply - Russia: The Tuapse port has resumed exports, and the refinery's processing and export volume are expected to increase in February. In January, high - sulfur fuel oil exports increased by 27% month - on - month and 30% year - on - year [10]. - Mexico: High - sulfur exports are at a historical low. In 2026, with the full - load operation of the Olmeca refinery and the stable operation of the Tula coking unit, high - sulfur exports will decline marginally [18]. - Middle East: Iran's situation is volatile. In January, high - sulfur fuel oil exports were 110 tons, down 10 tons month - on - month and 9% year - on - year. Iraq plans to supply over 6 million tons of high - sulfur fuel oil from January to June 2026 [21]. 3.2.2 High - Sulfur Fuel Oil Demand - Feedstock demand: PetroChina has been actively purchasing high - sulfur fuel oil in the Singapore spot window. In January, China's high - sulfur arrivals increased by 5% month - on - month [24]. - Marine fuel demand: Singapore's high - sulfur marine fuel bunkering in December 2025 increased by 14% month - on - month and 15% year - on - year. The proportion of high - sulfur marine fuel consumption continued to increase marginally [27]. 3.2.3 Low - Sulfur Fuel Oil Supply - Nigeria: The Dangote refinery's RFCC unit restart has been postponed. In January, low - sulfur exports were about 360,000 tons, up 49% month - on - month [30]. - South Sudan: Energy facilities' supply is gradually recovering. In January, exports declined to about 190,000 tons but have room for further growth [31]. - Middle East: The Al - Zour refinery in Kuwait has fully recovered production. In January, low - sulfur fuel oil exports reached a record high of about 1.15 million tons [34]. - Pan - Singapore region: The Balikpapan refinery in Indonesia has completed its transformation and upgrading project, with expected offsetting changes in VLSFO production [37]. 3.2.4 Low - Sulfur Fuel Oil Demand - There is no specific driving force. Singapore's low - sulfur marine fuel bunkering in December 2025 increased by 2.4% month - on - month and 15.0% year - on - year, but the proportion decreased by 0.4 percentage points [40]. 3.2.5 Marine Fuel Oil - The proportion of high - sulfur marine fuel demand continues to increase marginally. The Red Sea suspension has indirectly promoted the growth of the high - sulfur marine fuel market share. The installation of desulfurization towers on global ships has accelerated [43]. 3.3 Weekly Data Tracking - The report provides various data charts on fuel oil prices, spreads, inventories, etc., including fuel oil spot prices, high - sulfur and low - sulfur fuel oil cross - regional and cross - period spreads, natural gas - fuel oil price ratios, cross - regional freight rates, Singapore bunkering spreads, and fuel oil inventory structures in different regions [47][52][62]

1. Report Industry Investment Rating - Not provided in the given content 2. Core Viewpoints of the Report - The fuel oil market is affected by multiple factors, with a neutral supply - demand situation. The low - sulfur market has sufficient supply, and the high - sulfur market also maintains an abundant supply. The demand for marine fuel oil is expected to increase before the Spring Festival. The market follows the trend of crude oil, with the low - sulfur fuel oil market structure being weak and the high - sulfur fuel oil market performing slightly stronger. FU2603 is expected to operate in the 2760 - 2810 range, and LU2603 in the 3250 - 3300 range [3] 3. Summary According to the Table of Contents 3.1 Daily Hints - The fundamentals of fuel oil show a neutral supply - demand situation. The 2 - month inflow of arbitrage cargoes from the West is expected to be high, keeping the low - sulfur market well - supplied. The high - sulfur fuel oil market also maintains abundant supply due to stable arrivals at the Singapore port. The demand for marine fuel oil is expected to increase before the Spring Festival. The basis shows that the spot is at a premium to the futures. The inventory in Singapore increased by 950,000 barrels to 25.529 million barrels in the week of February 4. The price is above the 20 - day line, and the 20 - day line is upward. The main positions in both high - sulfur and low - sulfur are short positions, with short positions decreasing. The overnight crude oil fluctuated, and the fuel oil followed. The low - sulfur fuel oil market structure is weak, and the high - sulfur fuel oil market is slightly stronger [3] - The prices of the FU and LU main contracts increased by 1.40% and 1.14% respectively, and the basis increased by 19.72% and 16%. The spot prices of various types of fuel oil also increased, with the Singapore high - sulfur fuel oil rising by 2.12% [5][6] 3.2 Long and Short Concerns - Bullish factors: Iranian situation turmoil and the issuance of Chinese import quotas [4] - Bearish factors: The optimism on the demand side remains to be verified, and the upstream crude oil is under pressure [4] - Market driver: The supply side is affected by geopolitical risks, and the demand is neutral [4] 3.3 Fundamental Data - The supply of fuel oil is abundant, with high inflows of arbitrage cargoes from the West for low - sulfur and stable arrivals at Singapore port for high - sulfur. The demand for marine fuel oil is expected to increase before the Spring Festival [3] 3.4 Spread Data - The report provides the spread between high - and low - sulfur futures, but no specific numerical analysis is given [10] 3.5 Inventory Data - The Singapore fuel oil inventory on February 4, 2026, was 25.529 million barrels, an increase of 950,000 barrels compared to the previous period. Historical inventory data from November 26, 2025, to February 4, 2026, are also provided [3][8]

Group 1 - Fuel oil futures experienced a rapid increase, reaching a peak of 2826.00 yuan, with a current price of 2800.00 yuan, reflecting a rise of 4.09% [1] - The supply of high-sulfur fuel oil in Singapore is limited due to tight supply from tugboats, leading to a continuous increase in spot price differentials [2] - Singapore's fuel oil inventory has decreased to its lowest level in eight months, with a 14.7% drop to 19.94 million barrels (approximately 3.14 million tons) as of January 28, indicating a second consecutive week of decline [2] Group 2 - The fuel oil market is expected to experience wide fluctuations, with supply and demand both increasing, and cost trends following crude oil movements [3] - The main contract for FU was reported at 2735 yuan/ton, with support expected around 2600, while the LU main contract was at 3217 yuan/ton, with support around 3100 [3]