SunSirs: Rising Freight Rates, China Domestic Ship Fuel Market has Rebounded

According to the Commodity Analysis System of SunSirs, as of November 27th, the average price of domestic fuel oil 180CST was 5,268.00 RMB/ton (including tax), a decrease of 0.75% from the price of 5,308.00 RMB/ton on November 20th.

According to SunSirs, as of November 27th, the self pickup low sulfur quotation for fuel oil in the Dalian area of CNOOC is 5,150 RMB/ton, and the self pickup low sulfur quotation for fuel oil in the Dalian area is 5,200 RMB/ton; The price for self extracting low sulfur fuel oil in the Shanghai area of CNOOC is 5,250 RMB/ton for 180CST, and 5,350 RMB/ton for self extracting low sulfur fuel oil of 120CST.

The international crude oil market has been fluctuating and declining recently. On a macro level, global economic data remains weak, and it is highly likely that the Federal Reserve will maintain high interest rates in the medium term, which will put pressure on energy demand. On the supply and demand side, the OPEC+ meeting of oil producing countries has been postponed, and the market is generally wait-and-see, waiting for policy guidance to be implemented. In terms of demand, the processing rate of refineries in North America remains low, while demand in Asia is uncertain and there is a trend of accumulating inventory in the market, suppressing the rise of oil prices.

In terms of international fuel oil, it is understood that the Singapore Enterprise Development Board (ESG): As of the week ending November 22, Singapore's medium distillate oil inventory decreased by 1,000 barrels to a two-week low of 10.422 million barrels; Singapore's light distillate oil inventory decreased by 1.707 million barrels to a one month low of 11.726 million barrels; Singapore's fuel inventory increased by 2.611 million barrels to a 9-week high of 2012.2 million barrels.

The weak international crude oil market has increased the wait-and-see sentiment in the domestic ship fuel market; Winter transportation costs have increased, and domestic blending costs have remained strong, supporting the domestic ship fuel market; In the shipping market, due to the impact of strong winds and cooling weather at ports, shipowners are restricted in transportation and freight rates have increased; At present, ship oil supply merchants are cautious in their operations, with light market transactions and mainly small orders in demand. At present, the low sulfur market price of fuel oil 180CST is around 5,000-5,300 RMB/ton, and the low sulfur market price of fuel oil 120CST is around 5,100-5,400 RMB/ton, which can be negotiated separately. It is expected that the fuel oil 180CST market will mainly consolidate in the near future.

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