Haitong Futures: SC Crude Oil hit its fourth daily limit-up yesterday, then sharply plummeted at the end of the session due to news impact.

On March 5th, the main contract 2604 of SC crude oil briefly hit the fourth limit-up again, rising by 711.3 yuan per barrel, but towards the end of trading, a sudden news shock caused a rapid decline, erasing nearly 10% of the gains, closing at 664.1 yuan per barrel, up 6.43%. The overall trend still appears strong. On Thursday, news triggered a major shock in the market. About 10 minutes before the domestic market closed in the afternoon, news suddenly broke that Iran stated it had not blockaded the Strait of Hormuz. Although subsequent reports showed that the Iranian Revolutionary Guard emphasized they had not blocked the strait, they clarified that they prohibit military and commercial vessels belonging to the US, Israel, European countries, and their supporters from passing through the Hormuz region, and any violations would be met with force. However, this news immediately caused the domestic SC crude oil that had hit the fourth limit-up to sharply plunge by 10%, and shipping futures also closed lower, with intraday volatility exceeding 20%. This performance indicates that after continuous large gains this week, the market has accumulated a significant amount of floating positions, making it very susceptible to large fluctuations. The quick plunge in oil prices at the end of Thursday’s trading is a concentrated release of this risk. Therefore, the Shanghai International Energy Exchange continued to adjust the daily limit and trading margin ratios for crude oil futures and related contracts after trading hours to help investors better manage risks. Currently, the geopolitical situation has entered a critical stage, with the fighting between the US and Iran and the navigation status of the Strait of Hormuz constantly influencing investors’ oil price assessments. It is expected that oil prices will remain highly volatile. Investors participating in the current market should elevate their risk control to the highest level and trade cautiously. ( Haitong Futures )