Hong Kong Stock Market Movement | Oil Service Stocks Rise Against the Market Trend, Market Concerns Over Escalation of Iran Situation, Institutions Say Oil Service Boom Transmission Takes Longer

CITIC Finance APP learns that oil service stocks are rising against the market trend. As of the latest report, Puda Tech (00650) is up 10.91%, trading at HKD 0.305; Shandong Mero (00568) is up 8.74%, at HKD 4.48; Sinopec Oilfield Service (01033) has increased by 4.17%, at HKD 1; CNOOC Oilfield Service (02883) is up 1.78%, at HKD 10.31.

On the news front, reports indicate that U.S. President Trump has told his advisors that he is “inclined to carry out a preliminary strike on Iran in the coming days,” followed by a larger-scale military attack in the coming months to force Iran to “yield” and reach an agreement according to U.S. demands. The market fears that U.S. military action against Iran could lead to disruptions in Iranian and Persian Gulf region oil production and logistics.

Orient Securities released a research report stating that, due to geopolitical conflicts, concerns over reduced oil and gas supply have increased, leading to a rebound in oil prices. Since oil service project construction cycles are relatively long, owners often need to observe whether oil prices remain sustained. Currently, geopolitical tensions have driven up oil prices and market expectations, but a recovery in the oil service sector still depends on specific events. We estimate that it will take at least about six months for the oil price rebound to translate into a recovery in the oil service sector. Considering that downstream companies will place more emphasis on long-term cooperation when selecting suppliers, we believe that highly competitive companies are more likely to benefit from the recovery.