The Middle East situation has caused fluctuations in global oil and natural gas prices, JPMorgan said in its research report. If long-term disruptions occur in the Middle East, it could impact over 20% of the potential supply in the global liquefied natural gas (LNG) market, leading to increased price volatility and challenging the long-held market view that supply surplus will persist into the 2030s.

That said, JPMorgan believes the short-term impact on China's gas utilities will be limited, as spot LNG accounts for only about 10% of these companies' total gas resources, which limits the immediate impact on procurement costs.

Should oil and gas prices remain high, however, procurement costs for pipeline gas and LNG may eventually go up, and industrial gas demand may also be affected. Consequently, JPMorgan maintains a cautious view on this sector.

JPMorgan prefers KUNLUN ENERGY (00135.HK)  +0.170 (+2.270%)    Short selling $41.18M; Ratio 30.155%   for its limited exposure to spot LNG risks, as this could help it perform better than its peers in a high energy price environment. KUNLUN ENERGY has been given a target price of HKD9 and an Overweight rating.

The broker also favors ENN ENERGY (02688.HK)  -0.750 (-1.195%)    Short selling $21.99M; Ratio 19.233%   , rating it at Overweight with a target price of HKD72.5. The company's LNG contracts can hedge against the risk of rising spot LNG prices.
(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-04-28 16:25.)

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