GF Securities Futures: Geopolitical conflicts may continue to restart, and the window for higher fuel valuations is coming again

Geopolitical conflict or further reboots could continue, and a higher valuation range is coming around again. Over the weekend, there were again signs that negotiations between the US and Iran had broken down and that hostilities might restart. Iran once again announced the closure of the strait, which means that not only can the remaining floating storage within the strait no longer be released, but the possibility that refineries in the strait area will increase output to make up the shortfall is also further reduced. As a result, it remains difficult for high-sulfur supply in the Middle East to recover.

In addition, in recent days, refineries in Russia have continued to be hit by Ukrainian drone attacks. More than 4 million barrels per day of capacity remains offline. Against the backdrop of the strait being blocked again, this further exacerbates global tightness in high-sulfur supply. This will continue to support current high-sulfur valuations, and it will also be a clear positive for FU futures, which rely on imported cargoes as the main delivery source. Going forward, FU is expected to remain on the strong side. (Caitong Futures)