- Premiums for Zhoushan-delivered LSFO fell to a six-month low of $4.26/mt on Jan. 20.
- Regional competition with Singapore intensified as Zhoushan flipped to discounts.
- Zhoushan Port achieved record sales in 2024 with a 3.2% annual growth.
The low-sulfur fuel oil (LSFO) market at Zhoushan has seen significant pricing shifts ahead of the Lunar New Year, driven by ample supplies, regional competition, and expectations of reduced February demand, reports SP Global.
Premiums at a Six-Month Low Amid Holiday Selling Pressure
Premiums for Zhoushan-delivered 0.5%S bunker over FOB Singapore marine fuel fell to $4.26/mt on Jan. 20, the lowest since July 2024.
Suppliers pushed for deals before Lunar New Year (Jan. 28-Feb. 4) and February’s traditionally weaker demand.
LSFO prices ranged from $586-$600/mt for deliveries between Jan. 23-27, with trades as low as $580/mt for Jan. 31.
Supply Dynamics Normalize After Year-End Crunch
January saw higher allocations for Zhoushan and Shanghai, easing the supply squeeze from late 2024.
Fresh export quotas from December contributed to replenishing cargoes from local refineries.
Weather and Barging Availability Stable
Barging schedules were mostly unaffected, though price fluctuations and weather conditions remain concerns.
Rising Regional Competition with Singapore
Zhoushan’s LSFO prices flipped to discounts versus Singapore, with spreads reaching minus $10/mt on Jan. 20.
Discounts stemmed from aggressive pricing enabled by new bonded fuel quotas and ample January supplies.
Record-Breaking Sales at Zhoushan
Zhoushan’s 2024 bonded bunker sales rose 3.2% year-on-year to 7.27 million mt.
December 2024 saw a record monthly high of 714,751 mt, a 42.8% year-on-year increase.
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Source: SP Global
