Oil and gas stocks in Hong Kong continued their recent upward trajectory. At the time of writing, CNOOC (HKEX: 00883) was up 5.46% at HK$23.96. PetroChina (HKEX: 00857) rose 5.21% to HK$10.09. China Oilfield Services (HKEX: 02883) gained 3.85%, trading at HK$7.02. SINOPEC CORP (HKEX: 00386) advanced 1.88% to HK$4.34.

The rally is supported by escalating tensions in the Middle East and seasonal demand factors. On the 19th, conflicting reports emerged from the US and Iran regarding traffic through the Strait of Hormuz. The US stated vessels were still passing through normally, while Iran claimed maritime traffic in the strait had dropped to zero. The same day, following another round of airstrikes, US forces targeted Abadan, a key Iranian oil hub.

Analysis suggests the recent escalation in US-Iran conflict, coupled with the potential renewed blockade of the Strait of Hormuz and rising demand for refined oil products during the peak season, has driven oil prices higher. However, some analysts believe the intensity and duration of this round of conflict may be weaker than the initial outbreak phase, with overall geopolitical risk trending downward. This could see Brent crude prices eventually retreating to around $80 per barrel.

In response to volatile international oil prices, domestic Chinese oil companies are mitigating their earnings sensitivity to price swings through integrated upstream and downstream operations and diversifying their oil and gas sources. They are also accelerating investment in the development of domestic offshore oil and gas resources to reduce dependence on foreign energy.