Oil Prices Soar on US-Iran Tensions, China Retail Hikes Expected

International crude oil prices have been on an upward trend in recent weeks, driven by rising geopolitical uncertainty in the Middle East. The US-Iran memorandum of understanding expired this week, with the US indicating it would not renew or resume negotiations. In response, Iran shifted its policy from defense to offense, insisting that navigation restrictions in the Strait of Hormuz remain in place and demanding that the US lift sanctions.

The 60-day window for the agreement's renewal has passed, and tensions between the two nations remain high. This has provided a strong risk-related support for oil prices, leading to a volatile upward trend throughout the week.

JLC calculations show that the reference crude oil average price rose to $87.46 per barrel by August 20, with a change rate of 5.84%. This indicates a required increase of 320 yuan per tonne for domestic gasoline and diesel retail prices.