Channel Infrastructure Can Benefit From Prolonged Rise in Crude Oil Prices — Market Talk

A prolonged increase in crude oil prices would be a net positive for Channel Infrastructure, says Macquarie. It highlights that around 93% of the company's revenue is indexed to the Producer Price Index. That means inflation is automatically passed through to customers via an annual fee escalation. For FY 2026, PPI indexation is 3.25%. In parallel, heightened global uncertainty has refocused government attention on fuel security. Macquarie says the financial, political and economic rationale for tighter Minimum Stockholding Obligations has strengthened. So, the outlook for storage has improved materially "and underpins the strategic case for additional projects, including the Seadra biofuels development," Macquarie says. It has a neutral call and NZ$2.77/share price target on Channel Infrastructure, which is down 1.0% at NZ$2.97. (david.winning@wsj.com; @dwinningWSJ)