HK Stock Market Move | Oil stocks are generally declining, the situation between the US and Iran is still unclear, and geopolitical risk premiums are rapidly diminishing from high levels.

Oil stocks in general are down, as of the time of writing, PetroChina (00857) fell 3.65% to HK$10.3; China Oilfield Services (02883) fell 2.24% to HK$8.72; CNOOC (00883) fell 1.93% to HK$26.46. On the news front, on Friday, Iran announced the complete opening of the Strait of Hormuz, causing oil prices to plummet by about 12% in a single day, closing at around $86.89 per barrel, reaching a new five-week low. However, on Saturday, Iran immediately announced the re-blocking of the strait, leading to a gunboat incident, leaving the market highly cautious about the uncertain situation. On the morning of April 20, international oil prices rebounded significantly, with WTI crude oil rising by over 8% at one point. Iran's First Vice President Eshaq Jahangiri stated that unless the U.S. lifts its naval blockade against Iran, the safety of navigation in the Strait of Hormuz will not be free. Some analysts believe that the recent adjustment in oil and gas-related assets is due to the fact that the market premiums generated by the geopolitical risks in the Strait of Hormuz have completely disappeared, rather than a substantial deterioration in industry fundamentals. They say that although the Strait of Hormuz has not returned to normal navigation, global oil supply has effectively been supplemented through capacity reallocation, reserve releases, and multiple oil transportation channels, leading to both oil prices and sector valuations fully digesting the geopolitical disruptions, with market trading logic quickly returning to its own fundamentals from short-term geopolitical speculation.