Ships at Zhoushan Port, China, which is recognized as one of the main refueling centers in the country, are now facing significant delays in the refueling process. The impacts of the war between the US and Iran have led to a decrease in fuel supply at this port, and prices have also increased.
Long Delays in Refueling
According to received information, ships that visit Zhoushan Port for refueling are now facing a waiting time of one to two weeks. This is while the waiting time under normal conditions was between one to two days. Informed sources in this regard have stated that this delay is due to restrictions on crude oil imports resulting from Middle Eastern tensions and changes in the production of oil fuels in China.
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Impacts of War and Production Changes
The war between the US and Iran has caused restrictions on crude oil imports to China. On the other hand, Chinese refineries have shifted towards producing gasoline and diesel to take advantage of higher profit margins. These production changes have led to a decrease in the production of residual fuels and consequently, a shortage of bunker fuels.
Current prices for low-sulfur fuels at Zhoushan Port have reached their closest level since March. These prices are more than 25% higher than fuel prices in Singapore, which is considered another important refueling center in Asia.
Chinese state producers produced 1.12 million tons of low-sulfur fuel in August, which is 13% less than the previous month. It is expected that bottlenecks in the oil fuel market will ease in early October, mainly due to a decrease in seasonal demand. Additionally, refueling activities at several Chinese ports during the upcoming national holidays are expected to decline.
Beijing has long been trying to turn Zhoushan Port into a regional refueling hub to compete with Singapore. However, Singapore remains the leader in ship refueling. China has also reduced taxes on oil fuels to attract commercial fleets to Asia, making prices more competitive and encouraging refineries to increase the production of low-sulfur fuels.
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