JP Morgan: Reiterate "overweight" rating on COSCO Shipping Energy Transportation (01138), expected to benefit from the reopening of the Strait of Hormuz.

JPMorgan Chase published a research report stating that the United States and Iran have reached a peace agreement, greatly increasing the possibility of the reopening of the Strait of Hormuz, which will bring a positive catalyst to oil tanker stocks. The reopening of the strait will increase the likelihood of normalizing crude oil purchase activities and inventory rebuilding, thereby driving oil tanker demand. The report reiterated a "buy" rating for COSCO Shipping Energy Transportation (01138) with a target price of 27 Hong Kong dollars. The report points out that since the Middle East conflict, the market has lost approximately 1.3 billion barrels of oil supply, causing the market to switch to importing from countries with longer voyages such as the United States, West Africa, and Brazil, pushing Very Large Crude Carrier (VLCC) freight rates to above historical averages. The bank believes that the recent weakness in oil tanker stock prices reflects a weakening of market confidence in panic inventory building, rather than deterioration of industry fundamentals.