HTSC·2025-05-23 04:35Investment Rating - The report maintains an "Overweight" rating for the oil and gas sector [5]. Core Viewpoints - The report highlights that oil prices have rebounded since May due to tariff adjustments and sanctions, despite a previous decline to the lowest levels in four years [1][10]. - It emphasizes the importance of OPEC+ production targets and the weakening willingness of member countries to cooperate, which are significant factors affecting short-term oil price movements [1][4]. - Long-term, the report suggests that high-dividend energy companies with production and cost-reduction capabilities, as well as growth in natural gas business, may present investment opportunities [4]. Summary by Sections Demand Side - The report notes a revision in global oil demand expectations due to tariff reductions and a slowdown in economic growth, projecting global oil demand increases of 740,000 barrels/day and 760,000 barrels/day for 2025 and 2026, respectively [2][15]. - In April, China's oil demand remained weak, with crude oil imports and apparent consumption of gasoline and diesel continuing to decline year-on-year [2][26]. - The report indicates that while U.S. refinery utilization rates have been increasing, the overall oil demand in emerging economies remains a key growth driver despite recent underperformance in Indian oil demand [2][16]. Supply Side - The report states that OPEC+ has continuously raised its production targets, with global oil supply growth expectations adjusted to 1.6 million barrels/day and 970,000 barrels/day for 2025 and 2026, respectively [3][29]. - It highlights that the U.S. shale oil industry may face pressure if WTI prices remain below $60/barrel, leading to a reduction in drilling activity [3][32]. - The report also mentions that OPEC+ countries have exceeded their production targets, which could lead to actual production increases being lower than nominal targets due to compensatory cuts [3][31]. Recommended Companies - The report recommends high-dividend energy leaders such as China National Offshore Oil Corporation (CNOOC) and China National Petroleum Corporation (CNPC) for their ability to increase production and reduce costs [4][54]. - It provides target prices for these companies, with CNOOC rated as "Buy" and CNPC rated as "Overweight" [54][55].