Group 1: Market Performance - The main contract of Shanghai Futures Exchange fuel oil futures closed down 3.7% at 4,476 yuan/ton overnight, and the main contract of INE low-sulfur fuel oil futures closed down 4.66% at 5,118 yuan/ton [1] Group 2: Market Analysis - After Trump's remarks on postponing the attack on Iran, the market's expectation of the easing of the Middle East situation increased, and international oil prices fell from high levels. FU and LU followed the decline on the overnight session. However, the war situation is still unclear, the Strait of Hormuz is not navigable, and the damage scope and degree of Middle East energy infrastructure are still accumulating, and the risks have not really subsided [2] - For the fuel oil market, high-sulfur fuel oil has a relatively high supply share from the Middle East and a large risk exposure to geopolitical conflicts. In addition to the logistics interruption in the strait, several refineries in the Middle East have been shut down due to attacks recently. As of now, the maintenance volume of Middle East refineries exceeds 2.6 million barrels per day, and even if the strait resumes navigation in the short term, the local refined oil supply may not recover quickly [2] - In the case of low-sulfur fuel oil, although the direct export share from the Middle East is not high, refineries in the Asia-Pacific region have reduced their production due to insufficient raw materials, leading to a passive decline in output. In addition, the high premium in the diesel market has a boosting effect on the low-sulfur fuel oil market. Currently, the diesel crack spread remains strong, and the high premium over low-sulfur fuel oil may attract more components, thereby indirectly tightening the supply of low-sulfur oil [2] Group 3: Strategy - For high-sulfur fuel oil, it is recommended to wait and see due to short-term sharp fluctuations [3] - For low-sulfur fuel oil, it is also recommended to wait and see due to short-term sharp fluctuations [3] - There are no strategies for cross-variety, cross-period, spot-futures, and options [3]

Group 1: Report Summary - The report is a fuel oil daily report dated August 20, 2025 [1] Group 2: Market Data - On August 20, 2025, the FU main contract was at 2718, up 32 from the previous day; the FU main contract position was 123,000 lots, up 28,000 lots; the FU warehouse receipt was 80,710 tons, unchanged [3] - The LU main contract was at 3446, down 20 from the previous day; the LU main contract position was 40,000 lots, down 4,000 lots; the LU warehouse receipt was 11,110 tons, unchanged [3] - The FU10 - 1 spread was -1, up 5; the LU10 - 11 spread was 3, down 4; the LU - FU main contract spread was 728, down 52 [3] - The FU09 - foreign market 08 spread was -19.1, down 1.2; the LU10 - foreign market 09 spread was 5.5, down 2.1 [3] Group 3: Market Overview - Important news: On Tuesday evening, Ukrainian drones attacked an oil pumping station in Russia's Tambov region, causing an oil supply interruption. Oil was then transported through the Druzhba pipeline to Hungary and Slovakia [6] Group 4: Market Analysis - High - sulfur fuel oil: Asian near - term high - sulfur supply and inventory remain at high levels. Ukrainian bombings of Russian refineries continue, affecting some refinery capacities. Mexican high - sulfur exports are falling. Middle - East high - sulfur exports are at a stable low level. High - sulfur supply pressure in the third quarter is slightly less than expected. Seasonal power - generation demand is gradually declining, and domestic feedstock demand support is not obvious after the increase in the consumption - tax deduction ratio. Singapore's high - sulfur bunker fuel loading volume in July reached the highest level since IMO2020 [7] - Low - sulfur fuel oil: The low - sulfur fuel oil spot premium is continuously falling. The increase in spot - window sellers and near - term supply has hit the low - sulfur spot price. Low - sulfur supply is continuously rising, and downstream demand has no specific drivers. Nigeria's RFCC unit has intermittent maintenance. South Sudan's low - sulfur raw - material supply is returning to early 2024 levels. Al - Zour's low - sulfur exports have rebounded to the high level of normal refinery operation, with a significant increase in exports to Singapore. The Chinese low - sulfur market has abundant supply and stable demand [7] Group 5: Other Information - The Singapore paper - cargo market: The high - sulfur Sep/Oct spread remains at $1.5/ton, and the low - sulfur Sep/Oct spread remains at $1.0/ton [8]

Report Summary 1. Report Industry Investment Rating No specific industry investment rating is provided in the report. 2. Core Viewpoints - The Asian high - sulfur fuel oil market supply is expected to remain stable, with the cross - month spread narrowing to the lowest level since January. The expected increase in high - sulfur fuel oil demand during the Middle - East summer peak has not had a substantial impact on supply. The market is currently neutral [3]. - The basis shows that the spot price is at a premium to the futures price, which is a bullish signal. Singapore's fuel oil inventory decreased in the week of June 18, also a bullish factor. The price is above the 20 - day line, and the 20 - day line is trending upward, which is bullish. However, the main positions in both high - sulfur and low - sulfur fuel oil are short, and the short positions are increasing, which is bearish [3]. - With the significant decline in crude oil prices and the upcoming negotiation between Iran and Israel, the fuel oil market is under pressure. It is expected to trade in a low - level range in the short term. The FU2509 is expected to trade between 2980 - 3030, and the LU2508 between 3680 - 3740 [3]. 3. Summary by Directory 3.1 Daily Tips - **Fundamentals**: Asian high - sulfur fuel oil supply is stable, demand is moderate, and the cross - month spread is narrowing. The expected demand increase in the Middle - East has not changed the supply situation [3]. - **Basis**: Singapore high - sulfur fuel oil basis is 158 yuan/ton, and low - sulfur is 78 yuan/ton, with spot premiums over futures [3]. - **Inventory**: Singapore fuel oil inventory in the week of June 18 was 2289.9 million barrels, a decrease of 22 million barrels [3][8]. - **Disk**: The price is above the 20 - day line, and the 20 - day line is trending upward [3]. - **Main Positions**: High - sulfur and low - sulfur main positions are short, and short positions are increasing [3]. - **Expectation**: Crude oil prices are falling, and the negotiation between Iran and Israel restricts the upside of fuel oil. Short - term low - level range - bound trading is expected [3]. 3.2 Multi - Empty Concerns - **Bullish Factors**: Deterioration of the Middle - East situation and the expected increase in summer power - generation demand [4]. - **Bearish Factors**: The optimistic demand outlook needs to be verified, and there is a possibility of relaxed sanctions on Russia [4]. - **Market Drivers**: The supply is affected by geopolitical risks, and demand is neutral [4]. 3.3 Fundamental Data - **Futures Prices**: The previous FU main - contract futures price was 3206, and the current price is 3020, a decrease of 186 (5.80%). The previous LU main - contract futures price was 3825, and the current price is 3686, a decrease of 139 (3.63%) [5]. - **Basis**: Singapore high - sulfur fuel oil basis is 158 yuan/ton, and low - sulfur is 78 yuan/ton [3]. - **Inventory**: Singapore fuel oil inventory data from April 9 to June 18 shows fluctuations, with a decrease of 22 million barrels in the week of June 18 [8]. 3.4 Spread Data The report presents a graph of the high - low sulfur futures spread from 2021 - 09 - 07 to 2025 - 06 - 07, but no specific numerical analysis of the spread is provided [13]. 3.5 Inventory Data - Singapore fuel oil inventory data from April 9 to June 18 shows that the inventory on June 18 was 2289.9 million barrels, a decrease of 22 million barrels compared to the previous week [8].