**Glass Futures Hit New Highs as Energy Prices Surge**
The domestic energy and chemical markets continued their upward trend, closely following the rise in crude oil prices. On the commodity market, energy-related products saw widespread gains, with the glass main contract for 1309 approaching the daily limit and closing up 2.84% on the day. This marked the second consecutive day of record highs.
On February 4, the newly listed glass contract on the Zhengzhou Commodity Exchange reached another all-time high. The main 1309 contract closed at 1,632 yuan per ton, rising by 2.84%. Trading volume surged to 2.403 million contracts, an increase of 943,000 contracts compared to the previous day. Open interest also rose sharply, increasing by over 60,000 contracts to 466,000.
Ma Shichao, an analyst from Guan Tongxi, noted that after a strong rally in the third session, trading volume remained high, and the long-short gap was still significant. Although there was no major change in long positions, short positions increased, indicating that retail investors are becoming cautious about the current high price, expecting a potential market downturn. However, bulls have not yet taken large profits, suggesting that the upward momentum is still strong. Analysts expect the glass market to continue rising in the coming days, though a slight correction may occur. A full reversal is unlikely, and the spot market conditions remain stable. It's expected that there will be no major moves before the end of the year, with the market likely to be dominated by fund flows.
Yan Zailiang, an analyst from Lu Zheng, pointed out that the spot glass market remains largely unchanged, with no major positive developments anticipated before the Lantern Festival. While the overall market is still strong, it hasn't moved far from its weak pattern. Contracts for 03 and 04 showed relatively smaller gains, and this trend is expected to become more evident over time.
Zhai Zailiang added that despite the high turnover in the glass market, the long positions held by Yongan remained steady. He emphasized that the recent price increases are still primarily driven by fund activity rather than fundamental demand.
In January, crude oil prices rose by 5.66%, with the March contract for New York crude oil closing above $97 per barrel. The increase was largely fueled by rising long positions. According to the latest CFTC data, WTI crude oil had a total of 1,553,636 contracts, up 61,769 from the previous week. Non-commercial net longs reached 267,989 contracts, an increase of 21,886, while the managed net longs rose by 9,646. Over the past month, total positions increased by 80,291 contracts, and non-commercial net longs climbed by 69,911.
Yao Yao, an analyst at New Lake, explained that the recent oil price surge was mainly due to macroeconomic and geopolitical factors. The European economy, which has been struggling with the debt crisis, has shown some signs of improvement. Additionally, tensions in Egypt, Israel, and Syria have raised concerns about Middle East stability. These factors, combined with the CFTC’s position data, indicate that the crude oil market is currently stronger than the short side.
Data on supply and demand in the energy and chemical sectors also showed that distillate demand remains strong during winter, while gasoline demand stays low. U.S. crude oil production continues to rise, reaching 7 million barrels per day. Meanwhile, third-party survey agencies reported that OPEC’s January production fell to a one-year low.
"Crude oil serves as the upstream raw material for various chemical products or fuel for processing," said Yao Yao. "Its rising price supports the cost of plastics and glass." According to the Wenhua Finance Commodity Index, the methanol index rose by 7.66% in January, coke by 4.66%, and the petrochemical, plastic, and PVC indices all increased by more than 2%.
"Tao Jinfeng, research director at Guotai Junan Research Institute, stated that chemical products have seen dramatic gains. Glass, PTA, plastics, PVC, natural rubber, and coke have all risen significantly and set new rebound levels. There is still room for further upward movement."
As the end of the year approaches, the market is expected to face tighter supply, and the upcoming demand season is likely to be more pronounced. This situation could lead to increased speculation in the market.
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