Vietnam Energy Stocks Retreat as Mideast Thaw Depresses Crude Oil Prices

Global crude oil prices have retreated following a de-escalation of tensions between the United States and Iran, diminishing geopolitical support for oil and gas equities while leaving long-term industry fundamentals largely intact.

On June 18, the United States and Iran announced the signing of a 14-point memorandum of understanding aimed at ending their conflict. The agreement initiated a 60-day negotiation period, during which Iran has consented to allow the free passage of vessels through the Strait of Hormuz, one of the world’s most critical shipping lanes for oil and gas.

The oil market reacted immediately, with crude prices falling sharply. Brent crude oil futures declined 1.1 per cent to $78.70 per barrel, while US West Texas Intermediate crude futures dropped 1.3 per cent to $75.80 per barrel.

This development has not only roiled international oil markets but has also directly impacted Vietnamese oil and gas stocks, a sector highly sensitive to fluctuations in crude prices.

Geopolitical Tailwinds Fade

For oil and gas companies, the price of crude remains a primary variable influencing investment, exploration, production, and profitability. Consequently, declining oil prices often trigger varied reactions across the industry’s sub-sectors.

In the short term, oil price movements will continue to be a decisive factor for the direction of energy stocks. As the sector’s rally loses steam, numerous industry shares have posted notable corrections.

Shares of PV Coating JSC (PVB), for instance, fell from a peak of $1.68 per share in March 2026 to $1.03 per share on June 18, a decline of 38.5 per cent.

Over the past month, shares of PetroVietnam Drilling and Well Services Corporation (PV Drilling, ticker: PVD) have fallen by more than 15.5 per cent.

PetroVietnam Transportation Corporation (PVTrans, ticker: PVT) saw its shares decline 14.23 per cent, while Binh Son Refining and Petrochemical JSC (BSR) lost over 21 per cent. Compared to its peak of $1.51 per share on March 4, BSR was trading at $1.07 on June 18, marking a drop of more than 29.4 per cent.

In Vietnam, companies in the upstream segment and oilfield technical services are the most directly affected. Businesses such as PV Drilling and PetroVietnam Technical Services Corporation (PTSC) typically benefit when oil prices remain elevated, as global energy firms accelerate exploration and production, boosting demand for drilling rigs and engineering services.

Conversely, when oil prices fall or the outlook for further gains weakens, the market grows concerned that new investment plans will be reviewed more cautiously. This tends to exert profit-taking pressure on oilfield service stocks after periods of strong performance.

PTSC, however, maintained positive growth momentum through the first five months of 2026 as several oil, gas, and renewable energy projects entered their peak implementation phase. The company reported consolidated revenue of $540.6 million, achieving 41 per cent of its annual target and representing a 34 per cent year-on-year increase. Net profit after tax reached $22.5 million, equivalent to 57 per cent of the full-year plan and up 11 per cent from the same period last year.

According to Kafi Securities, PTSC’s total revenue for the 2026-2030 period is projected to reach between $8.4 billion and $8.8 billion, implying a compound annual growth rate of approximately 15 per cent.

For midstream operators like oil and gas transporter PVTrans, the impact is generally considered more neutral. During periods of geopolitical tension, oil freight rates typically rise due to increased marine insurance costs. As conflict risks subside, this advantage may diminish. On the other hand, global oil transportation volumes could increase if Iranian supply returns to the market, helping to offset the impact of easing freight rates.

Analysts at Saigon-Hanoi Securities JSC anticipate that PVTrans’s profit margins will improve in 2026. The company is entering a harvesting phase after an aggressive fleet expansion from 2023 to 2025. The addition of new vessels has driven rapid growth in revenue and EBITDA, while depreciation pressure has gradually eased since the second half of 2025 as several large vessels completed their accelerated depreciation schedules.

In the downstream segment, represented by Binh Son Refining and Petrochemical JSC, the impact of oil prices is more complex. Lower crude prices reduce feedstock costs and fuel consumption demand. However, business performance also hinges on the crack spread—the margin between crude oil prices and the prices of refined petroleum products. Therefore, a decline in oil prices does not guarantee a corresponding increase in profitability.

Should the agreement between the United States and Iran hold, the cooling trend in oil prices could persist in the coming months. This suggests that oil and gas stocks are likely to lose the growth momentum previously fueled by geopolitical factors. Nevertheless, over the longer term, the positive business outlook for many of these companies could still create noteworthy investment opportunities.