UBS Group released a research report, adjusting the average price forecast for Brent crude oil this year to $80 per barrel; forecasts for 2025 and 2026 were also adjusted to $75 per barrel each. The bank believes that demand issues remain the main downside risk for oil prices, especially as China's mainland economy slows down.

UBS Group also reduced its forecast for global crude oil demand growth this year to around 1 million barrels per day; the forecast for growth in China's mainland was reduced to around 0.3 million barrels per day, consistent with the bank's downward revision of China's GDP growth forecast. In addition, the bank also lowered its forecast for global oil demand growth in 2025 to around 1 million barrels per day.

UBS Group adjusted its profit forecast for the 'Big Three Oil Companies,' expecting PetroChina (00857.HK) to have profits of 169.3 billion, 168.4 billion, and 173 billion Chinese Yuan respectively for the fiscal years 2024 to 2026; Sinopec (00386.HK) to have profits of 67 billion, 75.8 billion, 84.8 billion Yuan respectively; CNOOC (00883.HK) to have profits of 152.9 billion, 150.1 billion, and 154.2 billion Yuan respectively.

UBS Group also adjusted the target prices for the 'Big Three Oil Companies,' including lowering PetroChina's H shares target price from HK$10.4 to HK$9.7; lowering Sinopec's H shares target price from HK$6.6 to HK$6.3; and lowering CNOOC's target price from HK$31 to HK$29.5. UBS Group has a 'buy' rating for the 'Big Three Oil Companies.'

The bank stated that since the third quarter, PetroChina, Sinopec, and CNOOC's H shares have fallen by approximately 27%, 13%, and 16% respectively, due to concerns about falling oil prices and weak demand in China. The bank considers the valuation of the 'Big Three Oil Companies' attractive, with forecasted PE ratios or PB ratios this year showing a discount compared to international peers. The dividend yield is appealing, with predicted dividend yields for PetroChina, Sinopec, and CNOOC's H shares at 9.3%, 8.5%, and 7.6% respectively. Furthermore, UBS Group expects oil prices to remain high in the second half of this year and in the long term (estimated at $76.5 and $75 per barrel respectively). The bank's preference order is Sinopec, CNOOC, and finally PetroChina.