Malaysia Energy Stocks Surge on Middle East Turmoil and Higher Oil Prices

The Malaysia energy sector has experienced a significant rally, with stocks reaching their highest levels in three months. The Bursa Malaysia Energy Index rose by over 1% following strong earnings from several companies last week.

Hengyuan Refining Company Bhd (KL:HENGYUAN) was the top performer, surging by as much as 30%. The company's share price reached its upper limit of RM2.53 with over five million shares traded at noon.

The rally in energy stocks is attributed to renewed turmoil in the Middle East, which has pushed oil prices higher. Hong Leong Investment Bank warned that persistent disruption at the Strait of Hormuz could lift oil prices per barrel back towards US$90 in the near term, with a base case for an average price of US$80 this year.

PETRONAS is expected to increase its capital expenditure for upstream projects next year, alongside energy security investments across the region. Brent crude oil was trading around $91 per barrel on Tuesday.