--- title: "The \"energy war\" in the Middle East continues to escalate, with oil, gas, and chemical assets surging across the board" type: "News" locale: "en" url: "https://longbridge.com/en/news/281852462.md" description: "The \"energy war\" in the Middle East continues to escalate, with oil, gas, and chemical assets surging across the board. The global petrochemical supply chain has been severely impacted, and the outlook for the reopening of the Strait of Hormuz remains uncertain. The A-share petrochemical sector is leading the gains, with the Wind Petrochemical Index rising over 5%. Iran claims that the Jubail Industrial City in Saudi Arabia was attacked, with oil prices reaching a peak of $116.5 per barrel during trading. Huatai Futures points out that the uncertainty in the Middle East situation is significant; if the strait is blocked, crude oil prices could exceed $200 per barrel, and refined oil prices may surpass $300 per barrel" datetime: "2026-04-07T08:38:09.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/281852462.md) - [en](https://longbridge.com/en/news/281852462.md) - [zh-HK](https://longbridge.com/zh-HK/news/281852462.md) --- # The "energy war" in the Middle East continues to escalate, with oil, gas, and chemical assets surging across the board ![Image](https://imageproxy.pbkrs.com/https://inews.gtimg.com/om_bt/Otwdbzj6oJHGcLd8jHAD3eLUxwJwPG8ZVt0fIvlXIOOwYAA/1000?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg) The global petrochemical supply chain has been hit hard again, with the prospects for the reopening of the Strait of Hormuz remaining unclear, leading to a surge in oil and chemical asset prices. On April 7, the A-share petrochemical sector led the gains, with the Wind Petrochemical Index closing up over 5%. The gains were even more pronounced among individual stocks in the chemical sub-sector, with Dongyue Silicon Material (300821.SZ) and Jiangtian Chemical (300927.SZ) hitting the 20% limit up, and about 20 stocks including Hengyi Petrochemical (000703.SZ) and Xinghua Co., Ltd. (002109.SZ) also hitting the limit up. In terms of ETFs, the chemical industry ETFs E Fund (516570), Huabao (516020), and Tianhong (159133) all rose over 3%. According to Xinhua News Agency, early on the 7th local time, Iran cited unnamed sources stating that an explosion occurred in the Jubail Industrial Area in northeastern Saudi Arabia, which involved American capital and was a result of widespread strikes. As a result, oil prices surged during trading, with WTI crude oil futures peaking at $116.5 per barrel, and as of the time of writing, were at $115 per barrel. Domestic commodity futures prices followed suit, with chemical products leading the gains; ethylene glycol rose by 10.99%, methanol by 8.69%, and the shipping index (European line) increased by 2.73%. Huatai Futures believes that the situation in the Middle East remains highly uncertain, with the reopening of the strait still a long way off and no clear path in sight. The arrival of Middle Eastern crude oil in Asia has already been interrupted. In the short term, balance can be achieved through the consumption of inventory oil, sanctioned oil, and reduced refinery loads, but the finished oil market lacks supply redundancy and is already in a demand destruction phase. If the strait remains blocked, the price of physical crude oil could exceed $200 per barrel, while the price of finished oil may surpass $300 per barrel. **Middle Eastern Petrochemical Facilities Under Attack** The war situation in the Middle East has escalated again, with the Jubail Industrial Area being one of the most important petrochemical production bases in the world, producing about 60 million tons of petrochemical products annually, accounting for 6% to 8% of global total production. The area is home to several large petrochemical companies and projects, with Saudi Basic Industries Corporation (SABIC) being one of the largest investors, along with the Sadara project involving American Dow Chemical Company, and a project jointly invested by Saudi Aramco and France's TotalEnergies located in this industrial area. Previously, according to Xinhua News Agency, the Israel Defense Forces stated on the 6th that they carried out airstrikes on a large petrochemical complex in the Asaluyeh area of southern Iran that day, which is Iran's largest petrochemical complex. The statement said that the Israeli military had struck two major petrochemical complexes in Iran, resulting in over 85% of Iran's petrochemical product export capacity being severely impacted. According to incomplete statistics from First Financial, since the outbreak of the US-Israel-Iran conflict on February 28, petrochemical facilities in the Middle East have faced systematic attacks, putting the global energy supply chain under severe strain Earlier, on April 4, the United States and Israel launched a large-scale airstrike on a petrochemical hub in Iran. According to CCTV News, the US and Israel attacked the Mahshahr Petrochemical Economic Zone in Iran on the 4th, evacuating personnel from all active industrial units in the zone. In addition to energy products, the impact on natural gas supply cannot be ignored. Going back to March 18, according to CCTV News, the Israel Defense Forces attacked the "largest natural gas facility" located in Bushehr, southern Iran, on that day. This facility processes 40% of Iran's natural gas. Iran subsequently warned that the energy facilities of Saudi Arabia, the United Arab Emirates, and Qatar have become "legitimate targets for attack." Guotai Junan Securities' research report pointed out that over 90% of Qatar and the UAE's liquefied natural gas exports pass through the Strait of Hormuz, accounting for 19% of global liquefied natural gas trade. At the same time, important natural gas fields in Qatar and Iran have been damaged to varying degrees, leading to production cuts or even shutdowns, and currently, there is no alternative route to transport this liquefied natural gas to other markets. High natural gas prices will severely impact the competitiveness of European manufacturing. **Severe Blow to the Global Petrochemical Supply Chain** Even more severe is the uncertain outlook for navigation through the Strait of Hormuz. According to CCTV News, the Iranian Parliament's National Security Committee has begun reviewing control plans for the Strait of Hormuz. A spokesperson for the committee stated that strategic action plans to ensure the safety of the Strait of Hormuz and the Persian Gulf have been included on the agenda. "Energy facilities in multiple Gulf countries have been attacked consecutively over the past month, combined with ongoing obstacles to navigation through the Strait of Hormuz, the global chemical supply chain is facing a dual test of supply contraction and demand destruction," a futures analyst told First Financial. The current evolution of the geopolitical situation remains the biggest variable for the short-term market, and close attention should be paid to the progress of restoring navigation in the strait and assessing the extent of damage to related facilities. The aforementioned futures analyst also mentioned that even if the Strait of Hormuz reopens, due to the transportation cycle required for oil, the market will still need several weeks to rebalance, and the related supply chain will take time to return to normal. Guotai Junan Securities analyzed that since the joint military strike by the US and Israel against Iran at the end of February 2026, and Iran's closure of the Strait of Hormuz, the total reduction in crude oil production in the Middle East has reached approximately 10 million barrels per day, accounting for 10% of global demand. Currently, the global crude oil supply gap has reached about 5 million barrels per day, and as remaining tank capacity continues to decrease, the reduction scale in Gulf countries is expected to continue to expand, with the recovery period extending from weeks to months. However, the impact of high oil prices is not "indiscriminate." CICC analysis believes that countries with diversified energy sources and alternatives (such as China and the United States) have a natural immunity; secondly, companies with strong cost absorption capabilities and high supply chain resilience can benefit by expanding market share when competitors' capacities are cleared. In the domestic market, E Fund analysis indicates that the significant rise in energy prices in Europe, Japan, and South Korea has increased production costs, which may accelerate the exit of overseas chemical production capacity. Chinese chemical companies, with diversified raw material sources, mature coal chemical alternative processes, economies of scale, and cost advantages, remain the strongest link in the global chemical supply chain in terms of risk resistance, and the exit of overseas capacity is expected to create long-term benefits for China's chemical market share and bargaining power **Foreign Banks Expect Oil Prices to Reach $200** With ongoing conflicts, the Strait remains unstable, pushing oil prices higher repeatedly. Since the outbreak of the conflict, WTI crude oil futures have risen by over 64%, peaking at nearly $120 per barrel in March. On April 7, Brent crude oil futures and WTI crude oil futures fluctuated at high levels of $111/barrel and $115/barrel, respectively. Guotai Junan Securities predicts that there is a significant possibility of international oil prices continuing to accelerate in April, with short-term prices potentially exceeding $120/barrel. They also raised the average price forecast for Brent and WTI crude oil in 2026 to $80/barrel to $90/barrel. Foreign banks have a more aggressive outlook on oil prices under extreme scenarios. Macquarie Group's latest forecast suggests that if the Iran conflict continues until June and the Strait of Hormuz remains closed, oil prices could rise to a record high of $200 per barrel. Macquarie emphasizes that the timing of the Strait's reopening and the physical damage to energy infrastructure are key factors determining the long-term impact on commodities. Citibank expects that if supply disruptions continue until the end of June, oil prices could soar to the "full cost" level of $200 per barrel. The so-called "full cost" includes not only the price of crude oil itself but also the refined oil premiums calculated based on consumption weights. Goldman Sachs believes that during supply disruptions, the market needs to continuously raise risk premiums to stimulate preventive demand shrinkage, thereby hedging against the risk of shortages in the event of long-term supply interruptions. The institution expects the average price of Brent crude oil from March to April to reach $110/barrel (previously forecasted at $98/barrel), an increase of 62% compared to the average price for the entire year of 2025. Guangzhou Futures has made assessments on specific varieties. In terms of ethylene glycol, the ongoing geopolitical conflict in the Middle East, coupled with supply contraction, rising costs, and funding support, has led to strong cost support from oil and coal. With short-term geopolitical risks unresolved, futures prices are expected to run strong; for crude oil and PX, the reduction in long-term supply from Japan, combined with the interruption of Middle Eastern naphtha exports, has led to Asian PX plants announcing force majeure, maintaining a tight supply pattern; regarding asphalt, before the situation substantially eases and the Strait resumes navigation, the asphalt market structure is expected to run strong. CITIC Construction Investment warns of risks from a more macro perspective, as the situation in Iran continues to escalate and remains complex and changeable, causing the market to fluctuate around negotiation signals. The next 2-3 weeks remain a high-risk period for potential sharp deterioration in the situation, with the market waiting for bottom-fishing opportunities and a strong short-term wait-and-see attitude among investors. 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