Fuel oil freight rates decline in China

Thu 27 Mar 2014, 12:22 GMT

Fuel oil freight rates decline in China

Rates are expected to decrease further in April due to weak demand.

Weaker shipping demand led to a decline in internal freight rates for fuel oil in China during the second half of March, ICIS reports.

According to industry data, freight rates for a 3,000 deadweight tonne (dwt) fuel oil ship plying the route from Dalian in northeast China to Zhoushan in east China were yuan (CNY) 70-80 per tonne on 25 March, which represents a decrease of CNY20 per tonne from two weeks ago.

A market source from a Zhoushan-based shipping agency said that fuel oil shipments declined notably because the peak turnaround season for independent (or 'teapot') refineries in Shandong Province had started, which in turn weighed on the freight rates.

Industry sources said they expected freight rates to fall further during the first half of April because shipping demand would remain weak with state-owned refiners starting turnarounds.

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