Core Viewpoint - The resurgence of conflict in the Middle East and ongoing international tensions have led to a significant surge in global oil prices, resulting in a speculative frenzy in the A-share oil and gas sector, particularly around Shandong Molong, which saw its stock price increase by 95.44% over a ten-day period [1] Company Performance - Shandong Molong has faced continuous financial losses, with only five profitable years out of the last fifteen, leading to a cumulative net loss of 4.44 billion yuan from 2021 to 2024 [2][3] - The company's net profit figures for the years 2021 to 2024 were -368 million, -425 million, -567 million, and -44 million yuan, respectively, with year-on-year declines of 1243.67%, 15.48%, and 33.39%, while a 92.29% recovery was noted in 2024 [2][3] Financial Health - As of the end of 2023, Shandong Molong's debt-to-asset ratio stood at 88.4%, with interest-bearing liabilities of approximately 1.679 billion yuan due within one year, leading to cash flow issues and some debts being overdue [3][4] Corporate Governance Issues - The company was officially designated as ST (Special Treatment) on April 1, 2024, due to significant uncertainties regarding its ability to continue as a going concern [4] - The company's major shareholder and management faced regulatory scrutiny for insider trading, leading to penalties totaling approximately 120 million yuan [11][13] Investment Decisions - Shandong Molong's significant investment in the HIsmelt technology, aimed at modernizing its operations, resulted in substantial financial losses, with the subsidiary, Shouguang Maolong, reporting cumulative losses of 1.031 billion yuan by August 2024 [9][10] - The company had invested over 1.65 billion yuan in the HIsmelt technology over nine years, but the results did not meet expectations, leading to the divestment of the technology as a non-performing asset [8][9] Recent Developments - Following its ST designation, Shandong Molong underwent management restructuring and applied for the removal of risk warnings in April 2025, leading to a significant increase in its stock price [15] - Major shareholders executed substantial sell-offs of their holdings shortly after the stock price surged, raising concerns about the sustainability of the company's recovery [16][17]