CITIC Securities: In the long run, the tension in the Middle East is having a weakening impact on global oil prices on the margin.

The report from CITIC Securities believes that crude oil is the most directly affected commodity by the situation in the Middle East. From the perspective of supply, once the tense situation in the Middle East directly involves oil-producing countries, the oil supply of relevant countries often declines significantly or only recovers after the conflict intensity decreases or the conflict is completely resolved. From a price perspective, the uptrend in oil prices driven by tense situations often occurs at the beginning of the conflict, with the subsequent oil price level still determined by supply and demand fundamentals. In the long term, as the share of oil supply from the Middle East decreases and the oil reserves and emergency mechanisms of consuming countries improve, the impact of tense situations in the Middle East on global oil prices weakens marginally.