Report Industry Investment Ratings - Crude oil: ★☆☆ [1] - Fuel oil: ★☆☆ [1] - Low-sulfur fuel oil: ★☆☆ [1] - Asphalt and liquefied petroleum gas: ☆☆☆ [1] Core Views - The short-term unilateral risk of oil prices is upward, and there is still significant uncertainty in geopolitical changes in the next two weeks. It is recommended to continue holding the long strangle strategy of out-of-the-money options for hedging and then enter medium-term short positions after the volatility increases [2]. - The fundamentals of fuel oil and low-sulfur fuel oil are relatively more bullish than before. Due to geopolitical conflicts, high-sulfur resources are more affected by geopolitical premiums, and the spread between FU and SC cracking has strengthened [3][4]. - The international LPG market rebounded supported by import demand. Currently, the domestic arrival volume continues to increase. Attention should be paid to the pressure on the domestic chemical industry after the increase in import costs [5]. Summary by Related Catalogs Crude Oil - Last week, the crude oil market rose. Brent's October contract rose 2.51%, and SC10 contract rose 1.13% [2]. - The promotion of the Russia-Ukraine peace agreement was not as smooth as the market expected. Since August, Ukraine has frequently attacked Russian energy infrastructure, and the market's previous pricing of the easing of the Russia-Ukraine situation has been revised [2]. - The net long positions in overseas crude oil futures and options have reached the lower end of the range and are still relatively sensitive to bullish geopolitical risks. Trump mentioned that if Russia and Ukraine do not hold direct talks within two weeks, large-scale sanctions will be imposed [2]. Fuel Oil & Low-Sulfur Fuel Oil - On Monday, the fuel oil futures continued to strengthen, with the FU increase being obvious, and the main contract rose above 2900 yuan/ton [3][4]. - As of the end of July, Singapore's marine fuel sales decreased by 1.7% year-on-year, and China's bonded marine fuel bunkering demand decreased by 1% year-on-year. At the same time, the enthusiasm of domestic refineries to produce marine fuel was also low, and the supply decreased by 19% year-on-year as of July [3][4]. - The onshore fuel oil inventories in Singapore and Fujairah decreased month-on-month, and the inventory pressure showed a relief trend [3][4]. - Due to geopolitical conflicts in Russia and Iran, high-sulfur resources are more affected by geopolitical premiums. In terms of variety spreads, the spread between FU and SC cracking has strengthened, and the spreads between LU-FU and BU-FU have significantly narrowed [3][4]. Asphalt - The content is the same as that of fuel oil and low-sulfur fuel oil [3][4]. LPG - The international LPG market rebounded supported by import demand. Currently, the domestic arrival volume continues to increase. Due to the low-price goods in the early stage, the sales pressure is limited. Attention should be paid to the pressure on the domestic chemical industry after the increase in import costs [5]. - With the stabilization of crude oil, the spread between naphtha and propane remains at an advantageous level, and there is high chemical demand in the short term [5].

Report Industry Investment Ratings - Crude oil: ★☆★, indicating a bullish bias but limited operability on the trading floor [1] - Fuel oil: ☆☆☆, suggesting a short - term equilibrium state with poor operability [1] - Low - sulfur fuel oil: ★☆☆, showing a bullish bias but limited operability on the trading floor [1] - Asphalt: ☆☆☆, indicating a short - term equilibrium state with poor operability [1] - LPG: ☆☆☆, suggesting a short - term equilibrium state with poor operability [1] Core Views - The report analyzes the market conditions of various energy products including crude oil, fuel oil, low - sulfur fuel oil, asphalt, and LPG, and provides corresponding investment suggestions and market trend judgments based on factors such as supply, demand, inventory, and price movements [2][3][4][5] Summary by Product Crude Oil - Overnight international oil prices rose, with the SC10 contract up 1.85% intraday. Last week, US EIA crude oil inventories decreased by 601,4000 barrels more than expected due to increased exports and decreased imports. The Russia - Ukraine peace negotiation has stalled, and the market's previous pricing of geopolitical easing needs to be revised. It is recommended to hold out - of - the - money option straddles for hedging and then enter medium - term short positions after the volatility increases [2] Fuel Oil & Low - sulfur Fuel Oil - Both high - and low - sulfur fuel oils rose driven by the rebound in crude oil. The shipment of high - sulfur fuel oil from the Middle East to Asia has been increasing, and the heavy residue fuel oil inventory in Fujairah has decreased. In August, the total arrival volume increased by 733,000 tons (25.1%) compared to June. The expected increase in heavy - resource supply from the Middle East still suppresses the market. The FU warehouse receipts decreased by 7000 tons to 73,710 tons, and the high - low sulfur spread narrowed slightly at the close [3] Asphalt - Since mid - August, the diversion effect of US imports of Venezuelan oil on North Asian resources has increased. Sinopec's increase in deep - processing load has led to an expanding year - on - year decline in cumulative asphalt production. The shipment volume of sample refineries in August increased by 8% year - on - year, breaking the growth bottleneck from June to July. Leading indicators such as the issuance of special bonds for toll roads and the cumulative domestic sales of road rollers are showing positive year - on - year trends, indicating potential asphalt demand. The futures are driven by the strengthening of crude oil, with the basis declining. The market is mainly in a volatile state, and the 10 - contract is expected to fluctuate narrowly between 3400 - 3500 yuan/ton [4] LPG - The overseas market has recently stabilized. Although exports are increasing, the procurement demand in East Asia provides support due to strong chemical profits. In China, the import arrival volume and refinery releases have increased, and domestic gas is still under pressure. After the decline in naphtha driven by the fall in crude oil, the cost advantage of propane has been continuously weakened. Under the expectation of a subsequent decline in chemical gross profit, the sustainability of the current high operating rate should be monitored. The market is waiting for the implementation of bearish expectations. With a high level of warehouse receipts, the top pressure is relatively strong, and the high - basis pattern can continue, with the market mainly in a low - level volatile state [5]

Report Industry Investment Ratings - Crude oil: ☆☆☆, indicating a clearer bearish trend with a relatively appropriate investment opportunity currently [1] - Fuel oil: ☆☆☆, suggesting a clearer bearish trend and a suitable investment opportunity [1] - Low - sulfur fuel oil: ☆☆, meaning a bearish stance with a clearer downward trend and the market situation is developing [1] - Asphalt: ☆☆☆, showing a clearer bearish trend and an appropriate investment opportunity [1] - Liquefied petroleum gas (LPG): ☆☆☆, representing a clearer bearish trend and a proper investment chance [1] Core Viewpoints - The crude oil market faces accelerated inventory accumulation pressure, with the price center likely to decline in the medium - term, but short - term uncertainties remain, and a strategy of holding out - of - the - money option straddles for hedging is recommended [2] - High - sulfur fuel oil is relatively weak in the oil product futures, while low - sulfur fuel oil is strong. The increase in high - sulfur fuel oil supply from the Middle East to Asia suppresses the market [3] - For asphalt, although production is declining, demand is expected to pick up during the "Golden September and Silver October" construction season. The price will fluctuate weakly, with the 10 - contract expected to trade in a narrow range of 3400 - 3500 yuan/ton [4] - The overseas LPG market is stabilizing, but the domestic market is under pressure. The cost advantage of propane is weakening, and the market will mainly oscillate at a low level [5] Summary by Directory Crude Oil - Since the second half of the year, global oil inventories have increased by 0.5%, with crude oil inventories decreasing by 0.7% and refined oil inventories increasing by 2.6%. In the fourth quarter, supply - demand surplus will expand, and there will be an annual surplus of 2.52 million barrels per day in 2026 [2] - Short - term overseas crude oil futures and options net long positions are at a low level, and uncertainties in the US - Russia - Ukraine negotiations remain. Hold out - of - the - money option straddles for hedging and wait for volatility to increase before taking mid - term short positions [2] Fuel Oil & Low - sulfur Fuel Oil - High - sulfur fuel oil is relatively weak, and low - sulfur fuel oil is strong, especially in the past two trading days, LU has risen against SC [3] - High - sulfur fuel oil shipments from the Middle East to Asia are increasing, and the total arrival volume in August has increased by 733,000 tons (25.1%) compared to June. The high - low differentiation of domestic FU and LU warehouse receipts has widened the high - low sulfur spread [3] Asphalt - After the US resumes importing Venezuelan oil, it is expected to divert North Asian resources. Sinopec's increase in deep - processing load has led to a year - on - year decline in asphalt cumulative production [4] - With the approaching of the "Golden September and Silver October" construction season, road demand is expected to pick up. In August, the sample refinery shipments increased by 8% year - on - year, and leading indicators are positive [4] - The low basis in South China supports the spot price, while the high basis in Shandong has shifted the spot price center down. The BU single - side price follows SC but with a smaller amplitude, and the low inventory still supports the price, with the 10 - contract expected to trade in a narrow range of 3400 - 3500 yuan/ton [4] LPG - The overseas LPG market has stabilized recently. Although exports are increasing, the procurement demand in East Asia provides support. In the domestic market, imports and refinery outflows are rising, but domestic gas is still under pressure due to weak gas demand [5] - After the recent decline in crude oil has driven down naphtha, the cost advantage of propane has been continuously weakened. Concerns about the sustainability of the current high operating rate are raised under the expectation of falling chemical gross margins [5] - The market is waiting for the realization of bearish expectations. With high warehouse receipts, the top pressure is strong, and the high - basis pattern will continue, with the market mainly oscillating at a low level [5]