HK Stock Market Move | COSCO Shipping Energy Transportation (01138) fell over 7% in the afternoon as the risk premium differences between various ports continued to widen.

COSCO Shipping Energy Transportation (01138) fell more than 7% in the afternoon, and as of the time of writing, it had dropped 5.86%, trading at HKD 13.81, with a transaction volume of HKD 213 million. In terms of news, the risks in the Strait of Hormuz have pushed up tanker chartering costs, with daily fees for Middle East routes approaching USD 500,000. However, analysts at Clarksons Securities pointed out that shipowners willing to load cargo deep within the Strait of Hormuz are reaping substantial scarcity premiums. In contrast, for those choosing to load in Oman Gulf outside the strait and sail to Asia, the average daily charter rate is significantly loweraround USD 147,000. Bank of China International published a research report stating that the increase in cargo volume on Middle East routes is limited. With ongoing restrictions in the two major straits, not all shipowners are willing to bear the associated risks, leading to a relative scarcity of eligible available ships, which supports a risk premium for cargo in the Gulf. The differentiation in risk premiums between different loading ports has also further widened. Additionally, there has been a significant reduction in new cargo volumes for Atlantic China Welding Consumables, Inc. routes, which is insufficient to support continued rapid increases in freight rates.