Renewable energy exchange-traded funds (ETFs) in South Korea surged over a one-week period from July 17 to July 24, with the PLUS Solar&ESS ETF climbing 20.65%, driven by escalating military tensions in the Middle East. Brent crude oil exceeded $100 per barrel on July 23 (local time) for the first time in approximately two months, fueling investor expectations for increased alternative energy demand. The price surge followed ongoing US airstrikes against Iran—12 consecutive days as of the article date—and concerns over supply disruptions from both the Hormuz Strait blockade and potential Red Sea rerouting obstacles caused by Yemeni Houthi rebel attacks.
Renewable Energy ETFs Post Double-Digit Weekly Gains
According to the Korea Exchange, renewable energy-related ETFs dominated the top performers in the domestic ETF market during the one-week period from July 17 to July 24. PLUS Solar&ESS recorded a 20.65% gain, the highest return among all ETFs. KODEX New & Renewable Energy Active rose 13.61%, TIGER 200 Energy Chemical Leverage gained 13.56%, TIGER Fn New & Renewable Energy climbed 9.35%, and KoAct Hydrogen Power ESS Infrastructure Active increased 8.57%.
Oil-related ETFs also posted strong returns. KODEX WTI Crude Oil Futures (H) rose 15.54%, and TIGER Crude Oil Futures Enhanced (H) gained 15.48%. Investment capital flowed into products betting on oil price increases as concerns over Middle East crude supply disruptions intensified.
SK E&C Reaches Record High on Trading Limit
Among individual stocks, SK E&C continued its upward momentum. The stock hit its upper trading limit the previous day, setting an all-time high, and rose an additional 0.37% on the following trading day to establish a new record.
US Conducts 12 Consecutive Days of Iran Airstrikes
The United States has conducted 12 consecutive days of airstrikes against Iran as of the article date and is preparing to deploy B-1 long-range strategic bombers and increase ground force troop levels. Iran has completed restoration of its air defense systems and deployed new anti-aircraft equipment, maintaining operational readiness.
As the military standoff between the US and Iran showed signs of prolonged escalation, international oil prices rose for five consecutive trading days. Brent crude, the international oil price benchmark, closed above $100 per barrel on July 23 (local time), the first time in approximately two months. The Hormuz Strait blockade continued, and concerns that Yemeni Houthi rebel attacks could disrupt Red Sea rerouting pushed prices higher.
Goldman Sachs Forecasts Brent Crude at $120 in Q4
Global investment bank Goldman Sachs projected that Brent crude prices could exceed $120 per barrel in the fourth quarter if disruptions at the Bab el-Mandeb Strait persist. The bank forecasted the average Brent crude price for next year at $100 per barrel.
Kim Kwang-rae, chief researcher at Samsung Futures, stated, "Concerns over Middle East supply disruptions are resurfacing as US airstrikes on Iran, the Hormuz Strait blockade, and signs of Red Sea rerouting blockades converge. With the US announcing unprecedented large-scale airstrikes, market volatility is expected to intensify further for some time."
FAQ
What caused renewable energy ETFs to surge during the week of July 17-24?
Renewable energy ETFs in South Korea surged due to escalating Middle East military tensions and rising international oil prices. Brent crude exceeded $100 per barrel on July 23 (local time), driving investor expectations for increased alternative energy demand. The PLUS Solar&ESS ETF rose 20.65% during the one-week period.
How did SK E&C perform during this period?
SK E&C hit its upper trading limit and reached an all-time high, then rose an additional 0.37% the following trading day to set a new record high.
What is Goldman Sachs' oil price forecast?
Goldman Sachs projected that Brent crude prices could exceed $120 per barrel in the fourth quarter if Bab el-Mandeb Strait disruptions continue. The bank forecasted the average Brent crude price for next year at $100 per barrel.
