China Securities Co., Ltd.: Energy assets are likely to experience wide fluctuations or a shift in their central tendency; investment logic is transitioning towards dividend assets.

China Securities Co., Ltd. released a research report stating that we are currently still in the Kondratiev long wave depression phase. From the perspective of long-term cycles, the Kondratiev depression period is often accompanied by a decline in economic growth and intensified geopolitical tensions. During this phase, oil, gas, and coal, as irreplaceable strategic physical assets, not only exhibit resilience against inflation but also display significant wide fluctuations or upward central tendency characteristics that outperform general financial assets in a stagflation environment. The investment logic in energy companies is accelerating the transformation into dividend assets characterized by "strong free cash flow + high dividends + continuous buybacks." The main points from China Securities Co., Ltd. are as follows: End of the US-Iran conflict memorandum, oil prices rise this week On August 17, the sixty-day window of the US-Iran conflict memorandum officially expired, but both parties have no intention to extend it. Iran announced that the relevant arrangements are invalid due to the other party's breach of contract and attempted to manage the Strait through transit permits and maritime passage fees. The US clearly rejected this proposal and continued its policy of escorting and blocking Iranian ports. The prospects for US-Iran peace talks remain uncertain. In addition, the UAE announced a suspension of financial and economic exchanges with Iran, and the US Treasury publicly stated that it would impose the toughest sanctions on Iran in history, with military conflict gradually shifting to economic sanctions. Overall, oil prices showed an upward trend this week amid unclear expectations for peace talks. This week, the spot price of Brent crude oil was $93.19 per barrel, up 0.1% week-on-week; the spot price of WTI crude oil was $85.83 per barrel, up 4.1% week-on-week. Xinjiang Coal Chemical Industry: Energy Security + Cost Advantage, Xinjiang Coal Chemical Industry is Expected to Enter a Golden Era From a national strategy perspective, Xinjiang benefits from two major shifts: from coastal economies to the Belt and Road Initiative, transforming from a geopolitical backwater into a front-line gateway, gaining geographic advantages. The scales of energy security and dual carbon environmental protection are beginning to tilt, marking the return of the coal chemical industry, with Xinjiang relying on its resource advantages to become the focal point of energy security. From Xinjiang's perspective, fostering development to promote stability is the main theme. Historically, Xinjiang has adjusted the balance between development and stability; currently, it is in a critical strategic opportunity period for high-quality development. The development of Xinjiang's coal chemical industry is similar to American shale gas in that it requires long-term national investment in underlying technology and infrastructure to ultimately overcome dependence on foreign energy. Natural Gas: OPEC Projects Global Natural Gas Demand Will Increase Significantly by 2050 On August 20, the Organization of the Petroleum Exporting Countries (OPEC) stated that global natural gas demand is expected to rise to an average of over 91 million barrels of oil equivalent per day by 2050, an increase of more than 19 million barrels of oil equivalent compared to 2025. OPEC pointed out that natural gas will further consolidate its long-term position in the global primary energy structure, largely replacing coal, and providing support for intermittent renewable energy in the power generation sector. As of August 22, US natural gas inventories stood at 3,169 Bcf, an increase of 16 Bcf from the previous week and a decrease of 30 Bcf from the same period last year; this week's average price of NYMEX natural gas was $2.76 per million British thermal units, up 0.2% from last week. Risk Disclaimer: Risks of significant fluctuations in international oil prices; risks of downstream demand recovery falling short of expectations; risks of overcapacity and policy regulation.