HONG KONG: Hopes that a global oil glut could be easing have sent energy firms soaring in Hong Kong, helping the Hang Seng Index pile on more than three per cent as part of an Asia-wide advance.
Chinese giants CNOOC and PetroChina were the main winners in a broad advance in Hong Kong, which has been boosted this week by lower expectations of a US interest rate hike.
The benchmark Hang Seng Index soared 3.13 per cent, or 682.42 points, to 22,514.04.
Stock markets in mainland China were closed for a public holiday and will reopen on Thursday.
Oil prices extended a recent surge in Asia on Wednesday, with US benchmark West Texas Intermediate up 2.0 per cent and Brent added 1.3 per cent.
On Tuesday WTI jumped 4.9 per cent and Brent soared 5.4 per cent after the US Department of Energy forecast a drop in average production in 2016 and an increase in global demand this year.
“There’s a bit of optimism creeping into the market,” Jonathan Barratt, the chief investment officer at Ayers Alliance Securities in Sydney, told Bloomberg News.
“Prices have found a base, $US45 has been a very solid level and it will be very hard to break back down below that.”
CNOOC lead the advance, surging 13.74 per cent to $HK9.52 and PetroChina rallied 9.20 per cent to $Hk6.29, while China Shenhua Energy zoomed 9.25 per cent to $HK13.94.
Energy companies have been under pressure recently as oil prices hit six-year lows in August on concerns about a slowdown in growth in China, the world’s biggest energy consumer, as well as a supply glut combined with high US and OPEC output.
The recent rally began last week after data showed a drop in US drilling activity, raising hopes this would help ease the oversupply.
