International oil prices have experienced significant volatility since March. Data shows that the main contracts for WTI and Brent crude futures approached $120 per barrel during the month, while the main domestic crude oil futures contract rose above 800 yuan per barrel. Affected by this, the prices of fuel oil and low-sulfur fuel oil futures have also shown considerable fluctuations, with their main contracts breaking through 5,000 yuan per ton and 5,900 yuan per ton, respectively.
To ensure the stable operation of the futures market, after the market close on March 18, the Shanghai Futures Exchange (SHFE) and the Shanghai International Energy Exchange (INE) issued an announcement adjusting the automatic conversion standards for hedging positions in fuel oil, crude oil, and low-sulfur fuel oil. The announcement stated that, starting from the last trading day of March 2026, for members who are not futures companies, overseas special non-broker participants, or clients of the fuel oil, crude oil, and low-sulfur fuel oil contracts who have not obtained hedging position quotas for the near-delivery months, their hedging position quotas from the general months will be automatically converted to zero lots for both buy and sell hedging positions upon entering the near-delivery months.
This move is reportedly another measure by the SHFE following multiple risk control actions targeting crude oil, fuel oil, and low-sulfur fuel oil since March to maintain market stability. Regarding the recent strong performance in the energy market, it is viewed as primarily driven by the conflict involving the US, Israel, and Iran. The escalation of this conflict led to the blockade of the Strait of Hormuz, disrupting approximately 20% of global crude oil supply and 35% of global seaborne high-sulfur fuel oil supply. The increase in Russian fuel oil exports is insufficient to fill the gap left by reduced exports from the Middle East.
It was noted that on March 9, market concerns about a prolonged blockade caused extreme panic globally, pushing international oil prices close to $120 per barrel and further increasing the costs of high- and low-sulfur fuel oils. The release of strategic reserves by the International Energy Agency (IEA) provided temporary relief to the tight supply situation.
The current market trend is significantly influenced by event-driven factors and emotional resonance, leading to high uncertainty in subsequent market movements. Analysis suggests that反复的地缘政治局势 will cause sharp fluctuations in crude oil and fuel oil prices. Investors are advised to avoid盲目追涨杀跌 and to focus on supply-side variables, including Russian export policies, refinery maintenance, and the restoration of navigation in the Middle East.
As price volatility increases noticeably for energy futures such as crude oil, fuel oil, and low-sulfur fuel oil, pressures on delivery guarantees and market operational risks have also risen. The adjustment to the management of near-delivery month hedging quotas for crude oil, fuel oil, and low-sulfur fuel oil is seen as an exercise of regulatory authority by the exchange according to rules. This adjustment does not affect the genuine hedging needs of实体企业 and, to some extent, helps avoid irrational positioning in extreme situations.
Specifically, this adjustment primarily optimizes the management of near-delivery month hedging quotas. It does not impact normal trading, delivery, or daily hedging demands, nor does it alter the fundamental market logic. However, after this adjustment, market participants wishing to hold hedging positions in the near-delivery months must apply for and obtain approved quotas from the SHFE in advance. The previous operational path of automatically converting general-month quotas into near-month quotas has been closed. This rule directly cites Article 13 of the "Shanghai Futures Exchange Hedging Transaction Management Measures," aiming to strengthen control and management of positions in delivery month contracts from an institutional source.
In terms of policy effect, this move is considered beneficial for strictly controlling the scale of delivery month positions, avoiding concentrated positions and mismatches in delivery resources. It guides market participants to plan their positions and hedging arrangements reasonably in advance, curbs irrational fluctuations, stabilizes delivery秩序, and builds a robust risk防线 from an institutional perspective, providing a more solid institutional guarantee for stable market operation and sound risk management for实体企业.
For实体企业 whose primary goal is risk management, it is提醒ed that they need to plan their hedging needs in advance and submit application materials according to the prescribed procedures to ensure sufficient operational flexibility during critical stages of the contract lifecycle. Conversely, positions that fail to obtain approval will be deemed as lacking hedging qualifications upon entering the two months preceding the delivery month, facing strict position limits. This effectively isolates the liquidity risks and delivery risks that speculative funds might trigger near delivery.
In fact, since March, with Middle East conflicts disrupting crude oil supply, refineries in several countries across the Asia-Pacific region have been affected. In Japan, for example, data from the Petroleum Association of Japan (PAJ) shows that for the week ending March 14, the capacity utilization rate of Japanese refineries dropped to 69.1% from 77.6% the previous week. Before the military strikes by the US and Israel on Iran, the utilization rate had exceeded 80%.
As for South Korea, which relies almost entirely on energy imports, on March 18, while introducing an emergency supply agreement, the country's Minister of Economy and Finance also publicly stated that South Korea would restrict naphtha exports and temporarily designate the feedstock as a supply chain economic security item. The South Korean President stated on March 17 that if the Middle East crisis persists, the government should formulate contingency plans, including restricting vehicle usage on specified dates.