Oil-related exchange-traded notes (ETNs) in South Korea posted double-digit gains this month as international crude oil prices surged past $100 per barrel, driven by escalating military tensions between the United States and Iran. According to Korea Exchange data as of the 24th, Meritz Leveraged WTI Crude Oil Futures ETN (H) closed at 51,490 won, a 69% jump from 30,465 won at the end of last month. The rally follows renewed conflict in the Middle East: Iran attacked vessels in the Strait of Hormuz, the US resumed airstrikes against Iran, and Yemen's Houthi rebels declared a blockade of the Bab el-Mandeb Strait, raising fears of oil supply disruptions.
Oil ETNs Dominate Monthly Returns with 60–69% Gains
Seven of the top 10 performing ETNs this month were products that profit from rising international oil prices. Shinhan Bloomberg Leveraged WTI Crude Oil Futures ETN B gained 61.1% over the same period, while Samsung Leveraged WTI Crude Oil Futures ETN rose 60.8%, Korea Investment Leveraged WTI Crude Oil Futures ETN B climbed 60.8%, and KB S&P Leveraged WTI Crude Oil Futures ETN B advanced 60.6%. These returns significantly outpaced the KOSPI's -21% performance this month.
Meritz Leveraged WTI Crude Oil Futures ETN (H) tracks twice the daily return of West Texas Intermediate (WTI) crude oil futures listed on the New York Mercantile Exchange (NYMEX). When WTI futures prices rise, the product delivers double the gain.
WTI and Brent Crude Prices Surge 33–38% Amid Supply Disruption Fears
As of the 23rd (local time), September-delivery WTI crude oil futures closed at $92.19 per barrel, a 33% increase from the end of last month. Brent crude closed at $100.69 per barrel, surpassing $100 for the first time in about two months and marking a 38% jump from the end of last month.
The price spike stems from renewed US-Iran military confrontation. War between the two countries broke out at the end of February, followed by a ceasefire agreement in early April and a memorandum of understanding (MOU) signed in mid-June, signaling the conflict was entering its final phase. However, Iran subsequently launched repeated attacks on ships in the Strait of Hormuz, the US resumed airstrikes on Iran, and the ceasefire effectively collapsed. Recently, Iran-aligned Houthi rebels in Yemen declared a blockade of the Bab el-Mandeb Strait at the entrance to the Red Sea, and President Trump hinted at the possibility of large-scale attacks on Iran, intensifying concerns over Middle Eastern oil supply disruptions.
Korean Oil Stocks Rally Up to 49% This Month
South Korean refining-related stocks also posted sharp gains this month in response to surging international oil prices. Korea Petroleum's share price rose 10% this month, while S-Oil surged 42% and Heungu Petroleum jumped 49%.
FAQ
What caused oil ETNs to surge 69% this month?
Meritz Leveraged WTI Crude Oil Futures ETN (H) gained 69% from the end of last month to the 24th as WTI crude oil futures prices rose 33% to $92.19 per barrel and Brent crude climbed 38% to $100.69 per barrel, driven by escalating US-Iran military tensions and fears of Middle Eastern oil supply disruptions.
How did Korean oil stocks perform this month?
Korean refining stocks rallied sharply this month: Korea Petroleum rose 10%, S-Oil surged 42%, and Heungu Petroleum jumped 49%, outperforming the KOSPI's -21% return over the same period.
