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Source: Energy Research Center Arbitrage Tracking: 1) Spread: On October 17, the SC night session's 1-3 month spread was -1.9 yuan/barrel, equivalent to -0.27 USD/barrel; the Brent 1-3 month spread was 0.25 USD/barrel; and the WTI 1-3 month spread was 0.43 USD/barrel. The SC night session-Brent main contract spread was 0.31 USD/barrel; the SC night session-WTI main contract spread was 2.91 USD/barrel. 2) Arbitrage: ① Valuation: At 2:30 AM on October 17, the Brent 2512 contract price was 61.15 USD/barrel and the SC 2601 contract price was 442.2 yuan/barrel, estimating the theoretical price of SC 2601 at 460.2 yuan/barrel. The deviation from the market valuation that day was -3.91%. From the 7-day moving average valuation, with the normal range being [-5%, 0], the valuation is within normal limits. ② Profit: The estimated delivery profit for SC 2601 was -28.8 yuan/barrel, equivalent to -2.92 USD/barrel. ③ Spread: The SC 2601-Brent 2512 contract spread was +0.32 USD/barrel, while the theoretical spread was 3.24 USD/barrel, indicating that the market spread is below the theoretical spread. (Note: Last week, Brent's first contract was 2512; SC's first contract was 2512; where M represents October.) 3) Summary: From a month-end perspective, oil prices showed volatility last week, with a general downward shift. On Friday evening, Trump's statement to ease trade tensions with China contributed to a rebound in oil prices. The Middle East spot market is exhibiting weak performance, and the crack spreads for refined oil products in the US and Europe are also under pressure, indicating a lack of effective support for oil prices from the supply-demand perspective. Regarding the domestic-international price spread, observing the SC-Brent cross-regional spread through a 7-day moving average, the SC-Brent spread remains weak. As we enter the fourth quarter, the tightening of quotas for independent refineries in China is leading to a decline in import volumes. Furthermore, the mutual port fees imposed by China and the US are keeping shipping costs high in the oil transportation market, weakening the arbitrage potential towards the West, which may increase reliance on inventories in the future. Looking ahead, the influence of SC and OPEC+'s production increases in the Middle East is directly intertwined, with the current supply-demand fundamentals being relatively weaker compared to external markets; thus, patience is needed before engaging in long positions on the price spread. In the short term, oil prices will continue to face significant pressure from over-supply, and geopolitical factors and macroeconomic power dynamics will likely create disturbances in the market. Next week, as the time approaches a potential easing in Sino-US trade negotiations, oil prices are expected to rebound from the low point of the year to release pent-up demand. However, following this rebound, it is anticipated that the price center will still likely shift downward, with high volatility expected in oil prices during this period, necessitating careful attention to timing and rhythm.