China’s bunker fuel oil market has now become a land of opportunities for market players as the deregulation of the bonded fuel oil market and increasing liquidity of the fuel oil futures, encourages the opening up of the boil blending market and now operate at low cost efficiency. This puts Singapore, which currently stands as the major bunker oil supplier in Asia, in a sticky situation with intensified competition now coming from China.
What does this mean for global market players, particularly trader and supplier looking to buy and sell fuel oil in China? With more fuel oil being stored and being exported out of China, this now imposes intensified competition among global independent refineries with potential threat to their operating margins. Moreover, how will global traders will be keen to know what policy changes and developments in China will affect their investment strategies.