Huatai Securities: Oil prices may have entered a bottoming out rebound phase.

Huatai Securities research report stated that since January 2026, geopolitical tensions in Venezuela, Iran and other regions have once again triggered market supply risk concerns. On January 23, WTI/Brent futures prices closed at $61.07/65.88 per barrel, up 6.4%/8.3% from the end of December 2025. Huatai Securities believes that geopolitical premiums have led to a bottoming-out rebound in oil prices during the off-season. With the recovery in demand and global strategic reserves, oil prices are expected to bottom out and rise in the second quarter to the third quarter of 2026. In addition, the Fed's rate cuts will stimulate demand, and the demand for refined oil in Asia, Africa and Latin America may improve. The average price for Brent in 2026 has been raised to $65 per barrel. In the long term, considering the marginal costs of major oil-producing countries and the demand for quality over quantity, the central price of oil is expected to remain stable at $60 per barrel. Energy leading companies with the ability to increase production and reduce costs, as well as incremental gains in natural gas businesses, may present investment opportunities. After oil prices bottom out, inventory losses are expected to decrease, leading to a turnaround in profitability for the petrochemical industry.