The F Samsung Crude Oil Futures ETF (03175) has surged more than 3%. As of the latest update, it is up 3.27%, trading at HK$10.75 with a turnover of HK$856,400.

According to reports, on June 11 local time, the Iranian armed forces announced the immediate closure of the Strait of Hormuz to all vessels, stating that any violators would become targets. Multiple Iranian media outlets also reported that, in light of regional instability, the Iranian armed forces' Khatam al-Anbiya Central Headquarters issued a notice closing the strait to all ships, including oil tankers and commercial vessels, with violators subject to attack.

This news has driven international oil prices higher during the session, with gains approaching 4%.

An analysis suggests that the market is underestimating the upside risks for oil prices in both the short and medium term. In the short term, the Strait of Hormuz has been closed for several weeks, forcing more oil wells to shut down. Prolonged shutdowns could lead to the permanent loss of some production capacity.

In the longer term, against a backdrop of low capital expenditures, the number of drilled but uncompleted wells and new drilling rigs in the United States has repeatedly hit new lows. This implies that the high level of U.S. crude oil production may be unsustainable. Future spare supply and pricing power are likely to shift into the hands of Middle Eastern producers.

The market had previously been overly optimistic about the pace of resolution for conflicts in the Middle East. However, real-world tensions are becoming increasingly apparent. Recently, the market has begun to gradually price in higher long-term oil prices, and potential inflation risks also warrant attention.