In July, the Chinese marine fuel market experienced a fluctuating downward trend

August 5th news

According to the commodity analysis system, the marine fuel market in East China experienced a fluctuating downward trend in July. As of July 31, the average price of 180CST fuel oil in China was 5,312.50 CNY/ton, a decrease of 2.3% from 5,437.50 CNY/ton on July 1.

In July, the price trend of 180CST fuel oil in China showed an overall downward trend. The fluctuation of international crude oil prices in July increased the wait-and-see sentiment in the Chinese marine fuel market. The downstream shipping market mainly focused on consuming inventory, with limited support from terminal demand. Shipowners were cautious in their operations, with transactions mainly consisting of small, necessary orders. It is understood that as of July 31, the self-pickup low-sulfur 180CST fuel oil price in Dalian offered by China National Offshore Oil Corporation (CNOOC) was 5470 CNY/ton, and the self-pickup low-sulfur 120CST fuel oil price was 5570 CNY/ton. In the Shanghai area, the self-pickup low-sulfur 180CST fuel oil price offered by CNOOC was 5100 CNY/ton, and the self-pickup low-sulfur 120CST fuel oil price was 5200 CNY/ton.

In July, the crude oil market experienced volatile upward trends. In the first half of July, OPEC+ released its annual World Oil Outlook, lowering energy demand forecasts and putting downward pressure on oil prices. Meanwhile, geopolitical tensions in the Middle East, increased U.S. sanctions against Russia, and the U.S.'s decision to impose a 30% tariff on most imported goods from the EU and Mexico starting August 1st contributed to fluctuations in international crude oil prices. However, in late July, the U.S. reached a new trade agreement with the EU, alleviating concerns about U.S. tariffs and potential new sanctions against Russia, leading to continued increases in crude oil prices.

Regarding international fuel oil, according to information from Singapore's Enterprise Singapore (ESG), as of the week ending July 30, Singapore's fuel oil inventories increased by 969,000 barrels, reaching a three-week high of 24.668 million barrels; Singapore's residual fuel oil stocks rose by 4.1% to 24.668 million barrels, hitting a new high in nearly three weeks.

Market forecast: As international crude oil prices declined entering August, the Chinese marine fuel market has adopted a wait-and-see attitude. Trading in China's blended raw materials remains sluggish, with transactions in the bunkering and shipping markets mainly driven by immediate demand. Market operations are cautious, and sentiment is dominated by observation. As of August 5, the spot price for low-sulfur fuel oil 180cst was quoted at 5100-5500 CNY/ton, while the spot price for low-sulfur fuel oil 120cst was quoted at 5200-5600 CNY/ton. It is expected that the fuel oil 180CST market will likely remain weak and consolidate in the near term.