CITIC CLSA: The possibility of oil prices surging above $100 is low, as current tensions are mainly limited to Iran

1. CITIC CLSA pointed out in its report that although the current tensions between the US, Israel, and Iran have caused oil prices to surge by more than 12% at one point, it is not appropriate to directly compare this to the spike in oil prices to $138 per barrel during the 2022 Russia-Ukraine conflict. The biggest difference is that Iran's daily crude oil production is about 3 million barrels, only one-third of Russia's 11 million barrels.2. The bank believes that the possibility of oil prices soaring above $100 is very low, at least for now, as the tensions are mainly confined to Iran and have not spread to other oil-producing countries in the Middle East. In the short term, oil prices may break through $80 per barrel, but this will mainly reflect the geopolitical risk premium rather than a substantial supply disruption.3. CITIC CLSA pointed out that there have been no reports of attacks on Iran's oil and gas infrastructure or export terminals so far, so supply disruptions at this stage should be minimal. The tensions are unlikely to lead to interruptions in crude oil imports by major Asian countries, but will inevitably increase crude oil costs, thereby squeezing refining profits.