Oil prices have surged for a month. Why are Chinese assets "more resilient"?

When it comes to stock trading, look to the Golden Qilin analyst reports—authoritative, professional, timely, and comprehensive—helping you uncover high-potential themes and opportunities!

Wall Street Insights

A month after the oil price shock, there are signs of China’s relative resilience in its assets: a low external dependency in the energy consumption mix, ample strategic oil reserves as a safety cushion, sustained independent breakthroughs in AI technology, and the natural low correlation between A-shares and global markets—all of which together form this anti-shock foundation. Global stagflation risk has not fully cleared, but Goldman Sachs’ view is clear: at current valuations, the risk-reward ratio remains favorable, and A-shares and H-shares are worth a strategic allocation.

The Middle East conflict has been raging for more than a month. Brent crude spot prices have jumped 50% from before the war to $110 per barrel, sharply worsening the dilemma of global growth and inflation.

However, amid what is arguably the largest-scale oil supply disruption in history, China’s assets have shown clear relative resilience—A-shares are down by only 4%. In terms of the risk-adjusted Sharpe ratio, they significantly outperform similar assets in emerging markets. Goldman Sachs believes that the deep transformation of the energy structure, ample safety cushion from oil reserves, and continued AI technology breakthroughs are jointly building China’s “anti-shock line of defense.”

Goldman Sachs maintains an “overweight” rating for A-shares and H-shares. It cuts the 12-month target prices for MSCI China and the CSI 300 by 5% and 4%, respectively—implying potential 12-month returns of up to 24% and 12%.

Analysts suggest focusing on three main lines: first, China’s long-standing energy diversification strategy has been effectively buffering external shocks, with policy dividends accelerating their realization; second, China’s PPI deflation cycle is expected to end 6 to 9 months earlier than previously predicted, with an upward revision to nominal GDP providing an implicit boost to corporate earnings; third, China’s proxy AI (Agentic AI) represented by “OpenClaw” is quietly taking off and is becoming the next core theme the market will reprice.

Energy-structure moat

In this global oil price shock, China’s energy structure has become the most important buffer cushion.

On the data side, in 2024, oil and liquefied natural gas accounted for only 28% of China’s total primary energy consumption—one of the lowest levels among the world’s major economies. Meanwhile, alternative and renewable energy sources such as nuclear, wind, solar, and hydropower have already accounted for 40% of China’s electricity generation, up sharply from 26% a decade ago.

On supply security, China has ample strategic and commercial oil reserves; even if crude oil imports were to drop to zero entirely, it could still support more than 110 days of consumption demand. In addition, China’s energy import sources are highly diversified—reliable replacement supply channels are provided by oil-producing countries outside the Middle East such as Russia, Australia, and Malaysia.

It is precisely based on the above structural advantages that Goldman Sachs believes the macro cost China is bearing in this round of shock is the lightest among major economies.

PPI turns positive 6 to 9 months earlier

A signal that’s easy to overlook but worth thinking deeply about is emerging: the global surge in energy prices could cause China to exit its deflation cycle earlier.

Goldman Sachs economists’ latest forecast shows that China’s PPI could end its year-on-year negative growth streak of up to 41 months as early as March 2026—6 to 9 months earlier than previously predicted. Driven by the outbreak of the Middle East conflict, Goldman Sachs also raised its forecast for China’s nominal GDP growth rate by 0.8 percentage points.

Historical data suggest that although investors often hold skepticism toward cost-push inflation, periods when PPI rises are historically strongly and positively correlated with improvements in corporate earnings and positive stock market returns—even in cost-driven inflation periods such as 2011, 2017/18, and 2021. A decline in real interest rates should, in theory, also support firms’ willingness to increase capital expenditures and prompt households to rebalance assets from cash/savings into the stock market.

The “slow bull” logic for A-shares remains unchanged

Since the outbreak of the war, although A-shares and H-shares have moved with the global stock market pullback, the value of their diversified allocation has been fully reflected. Since February 28, CSI 300 and MSCI China have fallen by 4% and 7%, respectively (year-to-date: -3% and -8%). Overall, they are roughly on par with the MSCI Global index and slightly better than emerging markets outside China.

More importantly, over the past month, A-shares and H-shares have significantly outperformed similar assets on a risk-adjusted basis: the Sharpe ratio is -0.7 for A-shares and -0.6 for H-shares. Over the past 52 weeks, the rolling correlation coefficients with the S&P 500 are only 0.2 and 0.3, respectively—highlighting their unique diversification value of “low correlation.”

Currently, foreign investors’ ownership share in the A-share market is only 3%. Combined with government “national team” policy backing that has recently shifted back to net buying, and with stock valuations that are still undervalued relative to domestic interest rates, the “slow bull” logic for A-shares remains firmly in place—continuing to offer strong opportunities for excess returns for investors across multiple strategies.

“OpenClaw” bursts onto the scene: oil prices stole some limelight from China’s AI, but the story isn’t over

Objectively, the Middle East conflict has also overshadowed another important milestone in China’s AI sector—the rise of proxy AI (Agentic AI).

If the “DeepSeek moment” proved that China can build AI models with global competitiveness under technology export controls, then the explosive growth of “OpenClaw” (GitHub star count has reached about 336,000) and the sharp climb in Token usage over the past several months are powerful evidence of broad AI adoption and strong commercial potential in China.

From a strategic perspective, this shift—from AI chatbots to proxy AI—shows the key conditions China’s AI needs to maintain competitiveness in the global ecosystem: a massive user base, open-source and capable large language models (LLMs), highly competitive Token costs, well-developed AI infrastructure, and globally leading manufacturing capabilities for physical AI application scenarios.

The “OpenClaw” potential beneficiaries identified by Goldman Sachs, despite an 8% cumulative decline within the year, have still outperformed the MSCI China index and Goldman Sachs’ broad China AI portfolio by 44 percentage points and 14 percentage points, respectively, since 2025. This excess return is enough to show that the AI main theme has not failed amid geopolitical turbulence.

		Sina Statement: This message is republished from Sina’s partner media. Sina.com publishes this article for the purpose of delivering more information and does not mean it agrees with its views or confirms the descriptions. The article content is for reference only and does not constitute investment advice. Investors act on this at their own risk.

Endless information and precise interpretation—available in the Sina Finance app

责任编辑：凌辰