Guotai Haitong: Middle East conflict causes blockage in strait, freight rates surge significantly.

Guotai Haitong released a research report stating that the conflict in the Middle East has caused disruptions in the strait, leading to a significant surge in shipping prices. The import and export of crude oil have decreased simultaneously, with a direct and significant impact on Asia. The growth in exports from the United States and Russia partially fills the gap, leading to a super bull market in oil shipping. Chinese fleets operate more efficiently than the industry average, with a strong performance expected in the second quarter of 2026 exceeding expectations. Key points from Guotai Haitong include: High-frequency tracking: The conflict in the Middle East has caused disruptions in the strait, leading to a significant surge in shipping prices. Due to the impact of the US-Iran war, the passage through the Strait of Hormuz has been blocked, leading to a sharp decrease in exports and a surge in oil prices. The disruption in crude oil trade continues, causing a significant increase in shipping prices. VLCCs entering majorly controlled by Iran, with over 40% destined for China and India. The Chinese fleets of COSCO Shipping Energy Transportation and China Merchants Energy Shipping primarily operate in the Middle East, West Africa, and Americas, maintaining high operational efficiency above industry standards. Export tracking: Restrictions in the strait have led to reductions in exports from the Middle East, while exports from the US and Russia have increased. The disruptions in the strait have caused a global decrease in crude oil maritime exports by around 12% in April. The decrease in Middle East exports has been partially compensated by exports from the United States and delays in export from Russia. Import tracking: Restrictions in the strait have led to reductions in imports, with a direct impact on Asia. The restrictions in the Strait of Hormuz have decreased import volume estimates by 16% compared to the previous year, with significant impacts on Asia. China's crude oil imports decreased by 28% in April, with an increasing import from the Delb port, reducing the overall share of imports from the Middle East (including Delb) to below 40%. Strategic view: Oil shipping is facing a super bull market, with Chinese fleets exceeding expectations. The oil shipping industry has achieved a super bull market in two stages between 2022 and 2025, and the conflict in the Middle East in 2026 has led to trade disruptions with high shipping prices. In the future, if the strait reopens, capacity utilization rates will remain high, leading to sustained high prosperity. If sanctions on Iran are lifted, market changes could bring even higher prosperity and significant performance growth. VLCCs are aging and will accelerate in the next five years, with current fleets within 20 years providing a stable supply, ensuring a high level of prosperity for several years. The strategic value of oil shipping is evident, with Chinese fleets operating more efficiently than the industry average, and a strong performance expected in the second quarter of 2026. Risk warnings: Geopolitical situations, economic fluctuations, oil prices, industry policies, safety accidents, etc.