Energy markets have been set ablaze. Stimulated by escalating tensions in the Middle East, A-share oil and gas stocks surged across the board after the market opened today. Tongyuan Petroleum secured a strong 20% limit-up, while multiple stocks including CNOOC, Zhongman Petroleum, COSL, and Intercontinental Oil & Gas hit their limit-up prices during the call auction. Prior to this, Brent crude futures had surged nearly 13% at the open, and WTI crude futures had jumped over 10%. Additionally, CME Group Inc announced that crude oil futures on the New York Mercantile Exchange triggered a circuit breaker mechanism at the start of this week's trading.

According to a report from CCTV News, on March 1st local time, Iran's Islamic Revolutionary Guard Corps issued a warning stating that if Iran's oil and gas facilities are attacked, all oil and gas facilities in the region would be destroyed in response. The global energy market is now highly focused on the latest developments concerning the "chokepoint" of the crude oil market—the Strait of Hormuz. Real-time data from international oil tanker traffic monitoring systems shows that the sailing speeds of oil tankers in the waters around the Strait of Hormuz have generally dropped to zero, with a large number of vessels halting operations to avoid risks.

Surge and Circuit Breaker Influenced by successive escalations in the Middle East situation, international crude oil prices soared at Monday's open. Brent crude futures surged nearly 13% at one point, reaching an intraday high of $81.57 per barrel, while WTI crude futures jumped over 10%, hitting an intraday peak of $75 per barrel. As of 10:30 AM, the gains for Brent crude futures had narrowed to 5.13%, and WTI crude futures were up 4.09%.

As a result, following the A-share market opening, the oil and gas sector experienced a broad rally. By 10:30 AM, Tongyuan Petroleum had hit a 20% limit-up. Stocks like Zhongman Petroleum, Intercontinental Oil & Gas, and Shandong Molong recorded 10% limit-ups, while Potential Energy and Xinjin Power surged over 10%. CNOOC rose more than 7%, and PetroChina gained over 4%. Hong Kong-listed oil and gas stocks also rallied strongly, with Shandong Molong skyrocketing over 47% and Sinopec Oilfield Service jumping over 17%.

On March 2nd Beijing time, CME Group Inc stated that crude oil futures on the New York Mercantile Exchange triggered a circuit breaker mechanism at the start of the week's trading, causing a two-minute delay in the market opening. Following the outbreak of conflict, global attention is firmly fixed on the Strait of Hormuz, the critical chokepoint for the crude oil market. This narrow waterway south of Iran is a vital artery for approximately 20% of global oil shipments.

The Strait of Hormuz connects the Persian Gulf and the Gulf of Oman, serving as the essential export route for crude oil from Middle Eastern producers like Saudi Arabia, Iraq, Qatar, and the UAE. About one-fifth of the world's oil shipments pass through this strait. Several shipping analysts noted that the rapidly deteriorating situation in the Middle East will likely push shipping costs higher, with oil tanker rates being the most noteworthy.

In a report, Goldman Sachs pointed out that within the key risk scenarios presented by its commodities team, the "most disruptive" would be a "sustained complete disruption" of oil flows through the Strait of Hormuz. The report also indicated that "these disruptions have already begun," but the core question is "how long they might last." This aligns with observations from Bloomberg, highlighting a key market focus: even if oil prices gap up at the open, what will ultimately determine whether volatility persists are factors such as strait transit, insurance and shipping recovery, and whether energy facilities are further targeted.

Morgan Stanley, in its latest report, raised its Brent crude price forecast for the second quarter of this year from $62.5 per barrel to $80 per barrel.

How Significant is the Impact? Javier Blas, a Bloomberg Opinion columnist, noted that despite extreme market panic, a crucial fact must be clarified: the shipping disruption in the strait is a result of "commercial fear," not a "physical blockade." From a macroeconomic perspective of the global economy, the energy market landscape is not yet out of control. "Iran has not yet weaponized oil, nor has it closed the strait. Israel and the US have not launched attacks on Iran's oil infrastructure," Blas analyzed. He suggested that the significant drop in shipping volume is more of a "self-imposed pause" by the market.

Currently, he describes the situation on two levels: Shipping volume has dropped significantly, with traffic "already substantially reduced," though a few tankers "passed through safely overnight." There is no factual occurrence of a "strait closure"; despite alarming claims on social media, Iran has not shut down the waterway. Blas further stated that the current partial halt resembles a "self-imposed" pause, partly due to insurers withdrawing coverage, and partly due to an industry standstill following "requests made by the US Navy in the initial hours of the conflict."

He also pointed out that some buffer comes from pre-attack shipments; crude oil exports from the Persian Gulf in February were nearly 10% higher than the previous month, with many cargoes having already left the region. However, he warned that if Washington cannot quickly reassure shipping companies about the strait's safety, the "self-imposed pause" could evolve into a genuine supply disruption.

Maxence Visseau, Head of Research at Arkevium in Dubai, stated, "Regarding US Treasuries, I expect yields to fall by at least 5 to 10 basis points in the initial phase. But the issue is oil. If there is any disruption in the Strait of Hormuz that pushes crude prices to $80-$90 per barrel, then the long-term bond market will be caught in a tug-of-war between safe-haven demand and the repricing of inflation expectations."

Madison Faller, Global Investment Strategist at J.P. Morgan Private Bank, said that for investors, the ripple effects could spread throughout the global economy and financial system. Energy is at the core of these risks, and the Middle East is a key hub for global oil and gas transportation. Even the potential for disruption can quickly impact production costs, consumer prices, monetary policy expectations, market sentiment, and broader growth and inflation outlooks.