The Middle East situation is sending signals of easing tensions, yet oil prices continue to rise. Shipping stocks surged strongly—China Merchants Energy Shipping hit the daily limit, and Huaxin Wealth’s oil and gas ETF rose more than 2%! Under the scar effect, will oil transport demand exceed expectations?

Why did the long positions in crude oil surge against the trend under the signals of geopolitical easing?

On April 1st, the A-share market fluctuated upward, with the Shanghai Composite index rising over 1.5%, shipping stocks surged, and the oil and gas sector hit new highs! By 13:30, the market’s higher-purity oil and gas ETF, Huichuanfu (159309), rose over 2%, with a trading volume of 100 million yuan, showing active trading.

Huichuanfu (159309) oil and gas ETF’s target index components mostly surged, with COSCO Shipping Development hitting the daily limit, China Ocean Energy rose over 8%, China Merchants South Oil rose over 5%, Jereh Group rose over 4%, CNOOC Engineering rose over 2%, while China National Offshore Oil Corporation and Guanghui Energy retreated.

【Top ten components of Huichuanfu (159309) oil and gas ETF target index】

As of 13:20, the component stocks are for display purposes only and do not constitute investment advice.

On the news front, signals of easing tensions between the US and Iran have been released. Senior US officials stated that even if the Strait of Hormuz remains largely closed, they are willing to end military actions against Iran. They believe the Iran conflict could end very soon, and other countries can reopen the Strait of Hormuz without US military aid. US Hagstrom said that the current “top priority” for the US is to seek an agreement to end hostilities with Iran. Iran stated that, Iran is willing to end the war, but only if its demands are met, especially guarantees against further aggression.

However, on April 1st, according to data monitoring, 43.7 million crude oil long positions appeared during the day, possibly heavily betting that geopolitical tensions would heat up again and oil prices would rebound. As of 13:25, ICE Brent crude rose 0.66%.

【Crude Oil: Iran Situation Will Continue to Dominate Market Influence]

Everbright Securities pointed out that in the short term, the Iran situation will continue to dominate the market, with energy prices fluctuating, geopolitical uncertainties, and inflation pressures intertwined. Even if diplomatic breakthroughs occur, infrastructure repair delays will prolong economic impacts.

Overall, oil price fluctuations in the second quarter are highly uncertain and are strongly correlated with the duration of US-Israel-Iran conflicts and the length of the Strait of Hormuz blockade. Overall, the oil price center of gravity is expected to shift significantly higher compared to the first quarter and remain volatile at high levels. (Source: Everbright Futures 20260329 “Oil & Energy: Q2 2026 Crude Oil Strategy Report”)

【Oil Shipping: IEA Releases Strategic Reserves to Hedge Oil Shortages, Scar Effect May Lead to Excess Inventory in Downstream Sectors]

The IEA requires member countries to hold strategic petroleum reserves of no less than 90 days of net oil imports from the previous year. To address the global oil supply tightness caused by US and Israel military strikes on Iran, on March 11, 2026, the IEA announced that 32 member countries agreed to release 400 million barrels of strategic reserves, with the US releasing 172 million barrels, expected to be completed within 120 days. Currently, the global daily net crude oil deficit is about 8 million barrels, and if the Strait of Hormuz is blocked for one month, the global deficit could reach 240M barrels. To fill this gap within six months after the blockade is lifted (to replenish consumed strategic reserves), roughly 40 VLCCs would be needed, about 4.4% of the current total VLCC fleet and 5.3% of compliant VLCCs. Additionally, considering the scar effect-induced excess downstream inventory demand, VLCC demand may exceed expectations in the medium term. (Source: Caitong Securities 20260316 “If Geopolitical Easing Occurs, How to View Oil Shipping Demand Under Scar Effect?”)

Specifically, domestic oil and gas stock index funds are numerous, among which Huichuanfu (159309) oil and gas ETF has the following advantages:

(1) More focused theme definition: Includes only oil and gas exploration, equipment, refining, transportation, and sales, highly concentrated on major oil and gas giants with high reserves, low-cost advantages, and stable dividends.

(2) Fewer samples for better purity: Although the scheme allows up to 50 stocks, currently only 44 are selected, ensuring quality over quantity. Compared to similar indices, the top ten components are all leading oil and gas stocks, with higher purity!

As of 20251231, the component stocks are for display purposes only and do not constitute investment advice.

(3) More flexible index, better performance: Thanks to the pure construction scheme of the CSI Oil & Gas Resources Index, its cumulative returns over six months, one year, and three years have led among similar indices.

As of 20260227, past performance of the target index does not guarantee future returns.

Huichuanfu (159309) oil and gas ETF focuses on the upstream and downstream of the oil and gas industry chain, with the most focused theme, enabling one-click exposure to key national pillar industries, covering resources, dividends, and China-specific valuation lines. Its target index is also more flexible, with better short-, medium-, and long-term performance!

Risk reminder: Funds carry risks; investment should be cautious. Investors should read the “Fund Contract,” “Prospectus,” “Product Summary,” and other legal documents to understand the fund’s risk-return characteristics, especially specific risks, and assess whether they align with their investment objectives, experience, and asset status. The fund manager commits to managing and operating the fund assets with honesty, integrity, and prudence but does not guarantee profits or that the principal will not be lost. All funds are high-risk products (R4), suitable for investors with an aggressive risk tolerance level (C4) or above after risk assessment. Investors should be aware of risks related to index investing, concentrated holdings of index components, and specific risks of ETF operations and targeted assets. The individual stocks mentioned are only objective examples of index components; the information provided is for reference only. Investors are responsible for their own investment decisions. The views, analysis, and forecasts in this article do not constitute investment advice. When subscribing or redeeming ETF units, authorized brokers may charge a commission of up to 0.50%, including related fees from stock exchanges and registries. For other funds, please refer to the respective prospectus and legal documents.