International oil prices return to $100, A-share oil and gas sector surges collectively

On March 12, international oil prices returned to $100 per barrel. As of the time of this report by JiJie News, Brent crude futures were at $100.302 per barrel, up more than 9%. The price approached nearly $120 per barrel on March 9 but then plummeted to around $90.

On the same day, the A-share oil and gas sector surged collectively. As of this report, Keli Co., Ltd. rose over 9%, Guanghui Energy, New Natural Gas, and Shouhua Gas increased over 7%, with Tongyuan Petroleum, Lanyan Holdings, Beiken Energy, and CNPC Engineering also rising.

In terms of news, although the International Energy Agency announced the release of 400 million barrels of oil reserves, ongoing conflicts between the US, Israel, and Iran, along with tensions in the Strait of Hormuz, continue to support international oil prices.

On March 11, local time, 32 member countries of the IEA, including Germany and the US, unanimously agreed to release 400 million barrels of oil from their emergency reserves to address disruptions caused by Middle East conflicts. This is the largest-ever release of oil reserves in history.

Germany’s Federal Minister for Economic Affairs and Energy, Robert Habeck, stated on March 11 that Germany would release 19.51 million barrels of strategic oil reserves to ease rising oil prices. The US Department of Energy also announced that starting next week, the US will release 172 million barrels from its strategic petroleum reserve. At the planned release rate, this process is expected to take about 120 days.

The bearish factors for oil prices have not offset the bullish ones. On the early morning of March 12, Iran’s Islamic Revolutionary Guard Corps announced the completion of the 40th wave of Operation “Real Commitment-4,” conducting joint operations with Hezbollah to target Israeli and US military bases in the Middle East. This marks the first coordinated attack by Iran and Hezbollah against Israel since large-scale military actions by the US and Israel.

In the early morning of March 12, the Israel Defense Forces (IDF) announced a large-scale airstrike on Tehran. On the evening of March 11, the IDF stated that it had recently launched about 200 projectiles from air and sea towards Hezbollah targets in Beirut, Lebanon.

Since the start of military actions against Iran, the IDF has attacked approximately 70 Hezbollah targets in Beirut, including about 50 high-rise buildings used by Hezbollah. The statement also said that five senior commanders were killed in these attacks on Beirut.

Amid recent conflicts, multiple oil facilities have been damaged. Early morning on March 12, local time, officials at the southern Iraqi port reported that two foreign oil tankers were attacked and set on fire within Iraqi waters. The attack occurred at Umm Qasr port, located on the western coast of Zubayr Bay, about 50 kilometers south of Basra, a southern Iraqi port city. Farhan Al-Fartousi, head of Iraq’s General Company for Ports (GCPI), stated on the same day that all Iraqi oil terminals have suspended operations.

Regarding the Strait of Hormuz, on March 11, Iran’s Islamic Revolutionary Guard Corps issued a statement reaffirming its absolute jurisdiction over the strait. The statement claimed that the US and its partners have lost the right to pass through the Strait of Hormuz. Several ships passing through the strait have reportedly been attacked.

Yang An, head of energy and chemical research at Haitong Futures, said that oil transportation through the Strait of Hormuz remains disrupted, and Middle Eastern oil-producing countries have already cut production by 6.7 million barrels per day. Even if the strait reopens, it could take weeks or even months to return to normal. This suggests that, over time, the tight supply situation in the crude oil market will become more severe.

Industrial Securities pointed out that the oil price center remains high, which may continue to be the main industry configuration backdrop for some time. Industries whose prices or profits are expected to move in tandem with rising oil prices will be an important part of the “price increase chain” in the future.