Caixin Futures: Divergent Trends in the Energy and Chemical Sector Before the Holiday, Geopolitical Risks Dominate Oil Pricing

⑴ In terms of crude oil, over the weekend, U.S. President Trump stated that the United States had a "very good conversation" with Iran, but still retains the option of taking military action. The second round of U.S.-Iran negotiations is expected to take place in the coming days, and the geopolitical crisis has not been completely resolved. ⑵ As SC crude oil and downstream petroleum products closely follow the international market, the cost side faces significant uncertainty. If negotiations break down, oil prices may rise further in the short term; if peace talks succeed, the geopolitical premium may fall back. It is recommended to maintain light positions or hedge during the holiday. ⑶ Regarding fuel oil, China's dependence on imported high-sulfur fuel oil is as high as 75%, with Iranian high-sulfur fuel oil accounting for 20% of domestic imports. The complex geopolitical situation increases supply risks. ⑷ The previous raid on Venezuela has already suppressed heavy oil imports. If the outcome of the U.S.-Iran negotiations is unfavorable, there is a possibility of military intervention, but policy uncertainty remains high. It is recommended to hold small long positions and avoid chasing highs. ⑸ For glass, vehicle controls in many regions before the holiday have led to almost no shipments from factories and very little market trading. After the 1,200-ton production line at Dongtai Zhongbo was shut down last week, Dejin's 600-ton daily capacity line also stopped feeding at the beginning of this week, bringing the national daily output down to 149,200 tons. ⑹ The main glass futures contract is not trading at a significant premium to spot prices. The probability of unplanned cold repairs is rising, and coal-to-gas production lines in Shahe may continue to be shut down. Short-term fluctuations are expected to be strong, and after the holiday, as it is the peak season for production, opportunities to go long on dips can be considered. ⑺ For soda ash, today's market was quiet with prices but little trading. Some companies have increased their operating rates, with capacity utilization at 86.41%. Total supply remains high, and there is seasonal inventory pressure ahead of the Spring Festival. ⑻ The expectation of oversupply due to new capacity coming online continues to weigh on the market. Sentiment remains weak, and although valuations are not high, the supply-demand imbalance persists. It is recommended to remain on the sidelines before the holiday and continue to focus on glass-long/soda-ash-short arbitrage strategies after the holiday. ⑼ For caustic soda, today Shandong liquid caustic soda prices rose while liquid chlorine prices fell, with chlor-alkali profits at minus 294 yuan. Shandong chlor-alkali operating rates remain stable, with no significant reductions or production cuts. ⑽ As logistics and downstream production slow down, there is a possibility that some chlor-alkali equipment in Shandong may reduce operating rates. Production cut expectations provide support to the market, but prices are unlikely to break out of the low-level fluctuation pattern. It is recommended to consider taking profits on short positions in the March contract before the holiday. ⑾ For methanol, today's spot price in Taicang was 2,215 yuan per ton, up 5 yuan from the previous trading day. The price in northern Inner Mongolia was 1,837.5 yuan per ton, down 5 yuan from the previous trading day. ⑿ Port inventories increased by 21,200 tons compared to the previous period, while plant inventories decreased by 28,000 tons. The methanol market is expected to fluctuate within a range before the Spring Festival, with limited upward and downward drivers. It is recommended to focus on reducing risk exposure and operate with light, short-term positions.