Futures: fuel oil opened lower on Monday and fell back, closing at 1,735 (down 39), reducing more than 7,000 positions in total and trading volume declined. OPEC+ agreed to extend the current measures of 9.7 million barrels/ day of oil production reduction to the end of July, but Saudi Arabia's stop of additional production reduction diluted the benefits of OPEC+ to extend the production reduction, which affected the crude oil market. Fuel oil fluctuated in short term or under pressure. Pay attention to international news, epidemic development and market sentiment change.

Strategy Analysis: OPEC's production reduction agreement continues to strengthen the support of low oil price, but the short-term supply-demand contradiction is still under pressure. With the sharp rebound of oil price, the monthly difference narrowed, and the increase of oil storage demand led to the rise of freight, supporting the forward price difference between the internal and external prices of fuel contracts. Although the worst stage of crude oil demand has passed, crude oil still needs time to recover considering the acceleration of global COVID-19 epidemic situation and the possible adverse impact of repeated conflicts between China and the United States on oil prices. If the accumulated reservoir pressure picks up, the oil price has the risk of further exploration. If the OPEC production reduction agreement continues, the oil price is expected to continue to rise in the short term.

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