HK Stock Market Move | COSCO Shipping Energy Transportation (01138) rose more than 4%, reportedly due to the resumption of shipping in the Red Sea. Institutions are optimistic about the company's profits reaching a new high.

COSCO Shipping Energy Transportation (01138) rose over 4%, as of the press release, up 4.58% to HK$14.85, with a trading volume of HK$75.2298 million. On the news front, Maersk reportedly announced on Tuesday that shipping group Hapag-Lloyd and Maersk will adjust the route of their shared shipping service to pass through the Red Sea and Suez Canal for transportation. It is understood that since the end of 2023, there have been multiple attacks in the Red Sea area, leading shipping companies to reroute their vessels around Africa. Now, major shipping companies are considering returning to this crucial TRADELINK route connecting Asia and Europe. At the same time, Maersk stated in a declaration that the security of the Red Sea and Suez Canal passage on this route will be provided by naval forces. CITIC SEC stated that in 2026, with structural growth in compliance market demand and low oil prices, the primary marginal variable for crude oil inventories may be the driving force, and the bank expects the annualized VLCC freight rate to range from $60,000/day to $75,000/day. In the current phase of realizing the upside of the cycle, the elasticity release of VLCC freight rates is expected to boost rapid growth in fleet profitability next year. In the short term, with the approaching off-peak season for seasonal transportation, it is recommended to enter the market at the right time. Guotai Haitong believes that the oil shipping industry has witnessed four years of continuous growth, and expects COSCO Shipping Energy Transportation to achieve a new high in profitability in 2025, with a significant year-on-year increase in performance in the first quarter of 2026. The bank predicts that the outlook for oil shipping in the coming years is expected to exceed expectations, and the profitability of foreign trade oil shipping has ample room for growth.