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]

Core Viewpoint - The domestic futures market for crude oil is experiencing a downward trend, particularly in the fuel oil sector, with significant price fluctuations observed in recent trading sessions [1]. Group 1: Market Performance - The main contract for fuel oil opened at 2470.00 yuan/ton and showed weak performance, with a maximum price of 2482.00 yuan and a minimum of 2399.00 yuan, reflecting a decline of approximately 3.03% [1]. - The fuel oil market is currently characterized by a weak and fluctuating trend, indicating ongoing pressure on prices [2]. Group 2: Supply and Demand Dynamics - According to Everbright Futures, the Asian low-sulfur fuel oil market is under pressure due to increased supply from replenishment of crude oil components and a rise in arbitrage flows, coupled with weak downstream demand in the Singapore hub [2]. - The high-sulfur fuel oil market is also facing challenges, primarily due to ample arbitrage cargo arrivals and high inventory levels at Singapore and Fujairah ports, suggesting that supply-driven market fundamentals may persist into January [2]. - Goldwind Futures noted a significant drop in global heavy oil discounts, with the Dar Blend crude discount falling to -6.75 USD/barrel, indicating increased pressure on low-sulfur fuel oil prices [2]. Group 3: Future Outlook - The processing demand from domestic refineries and the U.S. is gradually declining, while ship fuel demand is also receding from high levels, suggesting a potential reduction in fuel procurement needs in Egypt next summer [3]. - The market sentiment remains cautious, with a recommendation to adopt a wait-and-see approach regarding future price movements [2].

1. Investment Rating The provided content does not mention the industry investment rating. 2. Core Viewpoints - Low - sulfur fuel oil: Supply is affected by refinery device changes. The supply incremental is less than expected due to the delay and shortening of the Dangote refinery's gasoline device maintenance plan. The Al - Zour refinery's device delay provides support. The supply gap disturbance from South Sudan has subsided. Demand for winter power generation lacks a driver, and attention should be paid to winter temperatures and natural gas conditions in Europe and East Asia [4]. - High - sulfur fuel oil: The spot window transaction price continues to decline, and the spot premium remains at a low level. It is expected to maintain a stable and weak trend in the fourth quarter. Russian exports are slightly affected by attacks, and Mexican exports have increased recently. The feed demand for fuel oil is expected to weaken due to the upcoming issuance of new crude oil quotas [4]. 3. Summary by Directory 3.1 Comprehensive Analysis and Trading Strategies 3.1.1 Comprehensive Analysis - Low - sulfur: Monitor the impact of refinery device changes on supply. The winter power - generation demand has no driver yet, and focus on winter temperatures and natural gas in Europe and East Asia. The supply reduction in the Pan - Singapore region is less than expected [4]. - High - sulfur: The spot price is weak, and the fourth - quarter outlook is stable and bearish. Russian exports are slightly affected, and Mexican exports are rising. The feed demand for fuel oil is expected to decline [4]. 3.1.2 Strategies - Unilateral: Weak and volatile, not advisable to buy at low levels [5]. - Arbitrage: High - sulfur cracking fluctuates at a low level, and low - sulfur cracking is neutral [5]. - Options: Hold a wait - and - see attitude [5]. 3.2 Core Logic Analysis 3.2.1 High - Sulfur Fuel Oil Supply - Russia: Energy facilities have recovered, and the overall refining capacity has increased. November exports increased by 17% month - on - month, and December exports are expected to rise [8][9]. - Mexico: Pemex's processing volume increased in October, and November exports were stable. High - sulfur supply is expected to decline marginally in the future [15]. - Middle East: Iraq plans to supply over 6 million tons of high - sulfur fuel oil in 2026. November exports decreased slightly from the October high. Sanctions on Iran continue [17]. 3.2.2 High - Sulfur Fuel Oil Demand - Feed demand: New crude oil quotas are expected to be issued in November 2026, with a significant increase compared to the end of last year. Feed demand for fuel oil is expected to weaken [4]. - Marine fuel demand: Supported by the stable growth of the number of desulfurization tower ships [26]. 3.2.3 Low - Sulfur Fuel Oil Supply - Pan - Singapore region: The expected excess supply is gradually decreasing as RFCC device operations increase [29]. - Nigeria: Supply is affected by the frequent changes in the Dangote refinery's maintenance time [32]. - Middle East: Device return times are all delayed, and the supply gap persists in the short term [35]. - Sudan: Energy facilities were attacked, and oil supply has recovered. Low - sulfur crude oil has been redirected to the Pan - Singapore region [38]. 3.2.4 Low - Sulfur Fuel Oil Demand - There is no specific driver. Marine fuel demand is stable, and power - generation is less economical than natural gas [40]. 3.2.5 China's Low - Sulfur Market - The export quota for bonded low - sulfur fuel oil in the fourth quarter is tight. The production in October increased, with different trends among different refineries [45]. 3.3 Weekly Data Tracking - Fuel oil spot: The document provides price trends of Brent, HSFO380, LSFO, and their spreads with other products [49][50][53]. - High - sulfur fuel oil spreads: Include cross - region and cross - period spreads [56]. - Low - sulfur fuel oil spreads: Include cross - region and cross - variety spreads [63]. - Natural gas - fuel oil ratio: Provides equivalent - calorific - value price data and changes [66]. - Cross - region freight: Shows freight trends between different regions [69]. - Singapore bunkering spreads: Presents spreads of HSFO and LSFO in Singapore [72]. - Fuel oil inventory: Covers inventory structures in Singapore, ARA, Fujairah, Japan, and the US [75]. - Northwest Europe inventory: Includes gasoline, diesel, and refined - oil inventories in ARA [82]. - US Gulf inventory: Covers gasoline, diesel, crude - oil, and Cushing crude - oil inventories in the US [85].

Report Summary 1. Industry Investment Rating - No industry investment rating is provided in the report. 2. Core View - The spot circulation volume of asphalt in North China and Shandong is relatively low, and the market supply remains at a low level, which supports the price stability; the main refineries in South China and East China focus on digesting their own inventories, which also provides some support for the asphalt price. However, there are still abundant low - price resources in the social inventory, which need time to be digested, and the market is still in a wait - and - see mood. The shipping price in East China is still expected to decline. In the future, the refinery operating rate in Shandong remains low, and the market supply is tight, which supports the regional asphalt price; in the East China market, under the influence of the shipping support policy, the market is in a strong wait - and - see atmosphere with weak purchasing willingness, and the shipping price still has room to decline in the short term [5] 3. Summary by Related Content 3.1 Asphalt Spot Market - In different regions, the current and previous spot prices in East China are 3200 - 3500, in Northeast China are 3020, in South China are 3130, in Northwest China are 3940, and in Shandong are 3030, with a 0% increase in all regions [1] 3.2 Asphalt Futures Market - For asphalt futures, the current values of BU2512, BU2601, and BU2602 are 3013, 3009, and 3024 respectively, with previous values of 3051, 3058, and 3073 respectively, and the corresponding increases are - 1.25%, - 1.60%, and - 1.59% [1] 3.3 External Market News - The London Intercontinental Exchange announced a ban on the delivery of diesel refined from Russian crude oil in third - countries, pushing the ICE diesel crack spread to a more than two - year high and further expanding the spot premium structure. Politico reported that the White House is about to announce a major new peace agreement with Russia to end the three - and - a - half - year Russia - Ukraine conflict, with an expected agreement on the framework by the end of this month or even as early as this week. A Russian diplomat explained that a missile fell on a US military base when a Russian fighter jet was on a mission over Israel due to the inability to replace multiple fighter parts because of sanctions. The Sudanese Energy Ministry's deputy minister said that Sudan has postponed some exports of South Sudan's Dar Blend crude oil due to recent attacks on oil facilities. Axios reported that the US and Russia are coordinating on a potential Ukraine peace initiative [3]