Report Industry Investment Ratings - Crude oil: ★★★ [2] - Fuel oil: ★★★ [2] - Low-sulfur fuel oil: ★★★ [2] - Asphalt: ★★★ [2] Core Views - The main tone of the crude oil market is a bearish pattern dominated by loose supply and demand. The short-term upside potential of oil prices is limited unless there is a significant disruption in oil supply due to conflicts [3]. - The fuel oil market is still dominated by geopolitical factors. High-sulfur fuel oil is affected by geopolitical risks such as the US-Iran tension, and its near-term prices are relatively strong. Low-sulfur fuel oil is under pressure due to the marginal increase in supply, but it is supported by the upward movement of gasoline and diesel cracking spreads [4]. - The asphalt market follows the trend of crude oil, but its price fluctuations are relatively limited. The market is in a range-bound pattern, and the arrival of Venezuelan crude oil needs to be closely monitored [5]. Summary by Related Catalogs Crude Oil - Trump's administration postponed military action against Iran, causing the geopolitical risk premium in oil prices to partially reverse. The short-term upside potential of oil prices is limited, and the market is mainly under pressure due to loose supply and demand [3]. Fuel Oil & Low-Sulfur Fuel Oil - The fuel oil market is geopolitically driven. High-sulfur fuel oil supply may tighten if Iranian exports are blocked, and the US high-sulfur market is suppressed by increased imports of Venezuelan raw materials. In the medium term, supply is expected to be loose. Low-sulfur fuel oil is supported by winter demand, but supply pressure is emerging as overseas refineries increase production. The absolute price of fuel oil follows crude oil, with high-sulfur being stronger in the near term and low-sulfur under pressure [4]. Asphalt - The asphalt market follows the trend of crude oil, but its price fluctuations are relatively limited. The market is in a range-bound pattern after factoring in the expected increase in costs due to the tightening of Venezuelan crude oil shipments to China. The arrival of Venezuelan crude oil needs to be closely monitored [5].

Report Summary 1. Investment Rating The report does not provide an overall industry investment rating. 2. Core Views - **Caustic Soda**: The market will face pressure in the later stage. Although the downstream replenishment in May supports the market, the sustainability of stockpiling is crucial. After replenishment, the market may short the chlor - alkali profit under the negative demand feedback. The market may show a positive - spread downward trend. The supply side will see more maintenance in June, especially in Shandong. The cost side has more room to decline due to the drop in coal and electricity prices, but the change in liquid chlorine price also needs attention. The strategy is to go short on rallies before significant supply cuts [5]. - **PVC**: It will fluctuate weakly. The high - production and high - inventory structure is difficult to ease. The high - production pattern will continue in the short term due to low costs and high caustic soda profits. The high - inventory pressure persists, and the export demand can only relieve it temporarily. The domestic demand related to real estate is still weak, and the procurement enthusiasm is low after the price rebound. Profit compression and supply cuts are needed to balance supply and demand [10]. 3. Summary by Directory 3.1 View Summary - **Caustic Soda**: The current situation is strong, but the expectation is weak. The market may decline in a positive - spread pattern. Do not be overly bearish below 2400. The key to the performance of 09 and 10 contracts lies in the scale and sustainability of maintenance from June to August [5]. - **PVC**: The high - production and high - inventory problem persists. The domestic demand is hard to improve continuously, and profit compression and supply cuts are required for balance [10]. 3.2 Caustic Soda Price and Spread - **Price**: The cheapest deliverable product price in Shandong is about 2656 yuan/ton [16]. - **Spread**: The 09 basis and 7 - 9 month spread of caustic soda are strengthening. The 50 - alkali to 32 - alkali spread is slightly higher than the evaporation cost, which is bullish for caustic soda. The export still supports the market in June, but there will be a price game between domestic and foreign parties. The arbitrage space between Shandong and South China is average [23][28][32]. 3.3 Caustic Soda Supply - **Market Structure**: The production is rising, and the inventory is falling. The current domestic caustic soda capacity utilization rate is 84.1%, a 1.5% increase from the previous week [44]. - **Maintenance**: Pay attention to the maintenance scale from June to August, with concentrated maintenance in Shandong in June [48]. - **New Capacity**: The planned new capacity in 2025 is 255 tons, but the actual expansion may be weaker than expected, with a capacity increase of about 2%. Pay attention to the commissioning of Tianjin Bohua and Gansu Yaowang in June - July [49][52]. - **Chlor - consuming Downstream**: The start - up of some downstream industries such as propylene oxide and dichloromethane has changed, which has a limited impact on caustic soda supply due to its high profit [58][69]. 3.4 Caustic Soda Demand - **Alumina**: The start - up and inventory are declining, and the profit is rebounding. Some regions are still in a loss state. The new capacity is still being put into production, and the demand for caustic soda may expand if there is a resumption of production [74][78][84]. - **Paper Pulp**: The capacity expansion continues, but the terminal demand is in the off - season, and the start - up of the finished paper industry is lower than the same period [85][90]. - **Other Industries**: The start - up of viscose staple fiber is declining, the printing and dyeing start - up is flat, the water treatment start - up is rising, and the ternary precursor start - up is stable [95][98][100]. 3.5 PVC Price and Spread - The PVC basis and 9 - 1 month spread are strengthening [110]. 3.6 PVC Supply and Demand - **Supply**: The start - up rate is declining month - on - month but has not reached the 2023 reduction level. There will be more maintenance in the Northwest from June to August. The new capacity in 2025 will reach 210 tons, with concentrated commissioning of 110 tons in June - July [115][116][117]. - **Demand**: The real - estate demand is still weak. The downstream start - up is rising month - on - month but is weak year - on - year. The export has certain demand in the early stage but is expected to weaken later due to the Indian rainy season and BIS policy. The warehouse receipt quantity will rise again [123][129][138].