Hong Kong Stock Movement: COSCO SHIP ENGY (01138) Falls Over 5% as Strait of Hormuz Closure Continues; Company Still Assessing Safety Conditions

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COSCO SHIP ENGY (01138) declined more than 5%, dropping 4.94% to HK$20 by the time of writing, with a turnover of HK$321 million. On the news front, according to a report, when asked whether any Chinese shipowner's cargo vessels had successfully passed through the Strait of Hormuz into open waters, a representative from COSCO SHIP ENGY's securities department responded, "We are still evaluating the safety situation." Additionally, a representative from China Merchants Energy Shipping's securities department revealed that the company currently has no vessels stranded in the Persian Gulf, and there are no plans to transit risky areas following the conflict. Instead, the company is using alternative shipping routes. Currently, tanker freight rates have risen more than 50% compared to pre-war levels. China Securities previously released a research report stating that the U.S. easing of sanctions on Iranian crude oil would have a short-term negative but long-term positive impact on the tanker market. On March 20, the U.S. granted a 30-day sanctions exemption for 140 million barrels of Iranian crude oil at sea to curb high oil prices. In the short term, floating storage crude oil around Asia will be discharged intensively, temporarily releasing shipping capacity. In the medium to long term, transit risks in the Strait of Hormuz are elevated, Iran has no additional crude oil supply, and Asian refineries are turning to sources from the Atlantic Basin, lengthening shipping routes and boosting tanker ton-mile demand.

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