COSCO SHIP ENGY (01138) surged over 8% in morning trading, up 6.14% at HK$7.09 per share as of press time, with trading volume reaching HK$253 million.

On the news front, the US President recently issued an executive order imposing an additional 25% tariff on India for its continued purchases of Russian oil, bringing India's total import tariff from the US to 50%.

Market analysis indicates that the US escalation of sanctions against Iran has led to Iranian crude oil exports operating at low levels for three consecutive weeks. US pressure on India to reduce Russian oil purchases has resulted in declining crude oil exports from Russia to India. These two major changes have pushed up demand for compliant crude oil, with increased substitution demand from VLCCs to smaller vessel types, further supporting the market.

Other analysis points out that since April this year, OPEC+ has continued to increase production, but seaborne export volumes have not grown synchronously. Due to summer being the peak oil consumption season in the Middle East, Europe and America, combined with the recent domestic seasonal low season, export volumes and freight rates have remained at relatively low levels. According to Vortexa data, exports from 8 OPEC+ countries continued to increase from September to November 2024. After the end of the Middle East's peak oil consumption season at the end of the third quarter, OPEC+ production increases may drive up seaborne export volumes, combined with the Northern Hemisphere's fourth-quarter peak demand season for oil products, freight rate elasticity is expected to emerge.