Understanding the Market | COSCO SHIPPING Energy rose over 4% in the afternoon, benefiting from the OPEC+ production increase cycle; sanctions against Russia may be favorable for the compliant market supply and demand

Zhitong
2025.08.06 06:04
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COSCO SHIPPING Energy rose more than 4% in the afternoon, and as of the time of writing, it was up 3.82%, trading at HKD 6.79, with a transaction volume of HKD 145 million. On the news front, OPEC+ agreed on Sunday to increase oil production by 547,000 barrels per day in September, which will end the recent production cuts earlier than originally planned. Huayuan Securities pointed out that they are optimistic about crude oil transportation benefiting from the OPEC+ production increase cycle and the favorable fundamentals of the Federal Reserve's interest rate cut cycle, while geopolitical uncertainties in the Middle East may enhance VLCC freight rate elasticity. With the acceleration of OPEC+ production increases, it is expected that the oil transportation market's prosperity may significantly improve by Q4 2025. In addition, Cathay Pacific Securities released a research report stating that according to shipbroker Gibson, Trump may restrict Russian oil exports through secondary tariffs. Over the past two weeks, Russian oil exports have fallen by nearly 30%, with India and China seeing declines of about 60% and 20%, respectively. If the U.S. strictly enforces sanctions against Russia, it may lead to a continued decline in oil transportation efficiency and changes in trade structure, likely benefiting the compliant market's supply and demand. It is expected that the effects of increased crude oil production and the performance of the oil transportation market in the second half of the year will be promising, along with options for falling oil prices

According to Zhitong Finance APP, COSCO SHIPPING Energy (01138) rose more than 4% in the afternoon, and as of the time of publication, it was up 3.82%, trading at HKD 6.79, with a transaction volume of HKD 145 million.

On the news front, OPEC+ agreed on Sunday to increase oil production by 547,000 barrels per day in September, which will end the recent production cuts earlier than originally planned. Huayuan Securities pointed out that they are optimistic about crude oil transportation benefiting from the OPEC+ production increase cycle and the favorable fundamentals of the Federal Reserve's interest rate cut cycle, while geopolitical uncertainties in the Middle East may enhance VLCC freight rate elasticity. With the acceleration of OPEC+ production increases, it is expected that the oil transportation market's prosperity may significantly improve by Q4 2025.

In addition, Cathay Pacific Haitong Securities released a research report stating that, according to shipbroker Gibson, Trump may restrict Russian oil exports through secondary tariffs. Over the past two weeks, Russian oil exports have fallen by nearly 30%, with India and China seeing declines of about 60% and 20%, respectively. If the U.S. strictly enforces sanctions against Russia, it may lead to continued declines in oil transportation efficiency and changes in trade structure, likely benefiting the compliant market's supply and demand. It is expected that the effects of increased crude oil production and the performance of the oil transportation market in the second half of the year will be promising, along with options for falling oil prices

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