South Oil ETF Manager Says Brent Could Top $110 in Q4 on Gulf Supply Risks

South Oil ETF manager Yang Kaining said oil prices have strengthened since July because geopolitical risk premiums have returned and supply and demand remain tight. Jiemian News reported that he cited IEA data showing Gulf crude output was still 11.4 million barrels a day below pre-conflict levels, while government strategic reserves had fallen to their lowest since December 1990, after a cumulative decline of 163 million barrels. He also cited Goldman Sachs as forecasting that Brent could break above $110 a barrel in the fourth quarter of 2026 if Gulf export stoppages persist. Yang said the fundamentals are also tightening even without geopolitical disruption. He cited EIA data showing U.S. commercial crude inventories fell to 410 million barrels and Cushing stocks dropped to the lowest level since 2014, while global crude supply was short by about 870,000 barrels a day and IEA calculations showed daily global stock draws of 3.8 million barrels. He added that the tighter market is supporting refinery margins, with U.S. refinery run rates at a historical high for the period and the Singapore refinery complex crack spread and the U.S. RBOB-WTI crack spread both above historical averages. The South Oil ETF (159026) turned over 5.91% and traded 3 million yuan on July 20, 2026. The underlying Guozheng Petroleum and Natural Gas Index (399439.SZ) rose 3.71%, and Yang said the index's dividend yield was above 3.8% as of July 20, 2026.