COSCO SHIP ENGY (01138) surged over 10% in early trading. As of press time, the stock was up 9.31% to HK$8.45, with trading volume reaching HK$355 million.

On the news front, the OPEC+ oil-producing alliance held a meeting over the weekend, announcing another increase in crude oil production by 137,000 barrels per day in October. This additional production increase means OPEC+ is beginning to lift the second layer of production cuts, with the timing moved up by more than a year from the original plan. Previous reports indicated that Saudi Arabia, the leader of OPEC+, is pushing the organization to consider restoring more oil production to regain market share.

Cathay Securities pointed out that the crude oil production increase continues to benefit oil shipping demand growth. The acceleration of OPEC+ production increases in the first half of 2025 did not materialize as expected, due to Middle Eastern production increases being offset by domestic consumption and US Gulf exports shifting to Europe, resulting in shorter shipping distances. Considering the end of peak domestic demand season in the Middle East leading to increased exports and South American long-haul production increases, the firm suggests that the benefits of production increases may gradually emerge in the second half of the year, supporting Q4 peak season performance, with industry participants maintaining optimistic expectations.

According to CNBC, Saudi Arabia hopes OPEC+ will continue to accelerate production increases to regain market share and offset declining oil prices. The firm believes that if implemented, this will further benefit oil shipping demand growth.