Bangkok: Energy groups are providing slight support to Thai stocks following Israel’s recent attacks on Iran, which have caused significant fluctuations in both crude oil and gold futures prices. Analysts caution that if the conflict escalates further, potentially leading to the closure of the Strait of Hormuz, oil prices could skyrocket to between 120 and 130 US dollars per barrel.
According to Thai News Agency, Mr. Nattapol Khamthakruea, Director of Investment Analysis at Yuanta Securities (Thailand), reported that Asian markets opened in negative territory, with Thai stocks experiencing minimal declines due to support from the energy sector. This support correlates with the substantial rise in crude oil futures prices amid concerns over the Middle East tensions, which led to a drop in Dow Jones futures by over 600 points. The crude oil futures price surged by more than 5%, with Brent crude reaching $76 per barrel. At 10:10 a.m., PTTEP’s stock price increased by 8.57%, rising 9.00 baht to 114.00 baht.
Krungsri Securities noted that the ongoing conflict between Israel and Iran poses short-term concerns for the global energy supply, benefiting upstream companies such as PTTEP and refineries. Should the situation escalate to a blockade of the Strait of Hormuz, PTTEP is positioned to gain the most, although refineries may face crude oil shortages. Conversely, the petrochemical sector may experience negative impacts.
KGI Securities (Thailand) released an analysis highlighting key stocks within the energy and petrochemical sectors, assigning a target price of 33 baht for TOP. This positive sentiment is bolstered by the strong recovery in crude oil prices, driven by the Middle East conflict, and progress on the CFP project, which could lead to oil stock profits and expedited contractor agreements.
Global Risk Management analysts warned that if Iran responds by closing the Strait of Hormuz, up to 20% of global oil shipments could be affected. JPMorgan anticipates oil prices could surge to $120 to $130 per barrel should the strait be closed.
The price of gold futures has also experienced a sharp rise, reaching up to 3,464 US dollars per ounce. In Thailand, the initial market opening price for gold increased by 850 baht per baht of gold amid the baht’s appreciation against the US dollar, valued around 32.39 baht per US dollar. As of 10:30 a.m., the price of gold in Thailand adjusted seven times, with gold bars selling at 52,550 baht and gold ornaments at 53,350 baht.
In New York, gold futures have surged as investors seek safe assets amid Middle East tensions. The US Producer Price Index (PPI) underperformance has led investors to speculate on potential interest rate cuts by the US Federal Reserve. The COMEX gold futures contract for August delivery increased by $58.70, or 1.76%, closing at $3,402.40 per ounce.
Israeli Prime Minister Benjamin Netanyahu confirmed that Israel’s military conducted a significant airstrike targeting Iran’s nuclear program and missile sites earlier today. The operation focused on critical components of Iran’s nuclear enrichment program, including top nuclear scientists and missile initiatives, with plans to continue over several days to eliminate these threats.