1. China tries to restart its economy
- China has begun to clear a backlog of container ships in an effort to jumpstart an idled economy.
- China processes about 30 percent of total global container traffic, and the coronavirus, and the subsequent shutdown of parts of the Chinese economy, have rippled around the world. About 715,000 containers typically pass through Chinese ports per day.
- Between February 11 and 17, Reuters says that the average wait time for a container ship at Zhoushan in southern China spiked to more than 60 hours due to the backlog, 20 hours longer than the average time in early January.
- Turnaround times are starting to improve at other ports as workers come back to the job. “The turning point has arrived... We are seeing that port congestion has eased and logistics start to revive,” Xu Kai, director of the Shipping Information Research Institute at SISI, told Reuters.
2. Jet and kerosene prices plunge
- The coronavirus pandemic is sinking commodity prices across the board, but jet fuel and kerosene are under particularly acute pressure as travel restrictions proliferate and the virus spreads beyond China’s borders.
- “[W]e have shaved off more than half of our global demand growth forecast for 2020 since January; it currently stands at just 50,000 b/d, vs 140,000 b/d in our previous forecast,” JBC Energy wrote in a note, referring to jet and kerosene demand growth.