Asia's FX screen today showed two currencies up and one flat: the yuan firmed, with USD/CNY closing at 6.6870, down 0.0493 from the prior print, and the won strengthened in step, USD/KRW at 1333.58, down 0.6037, while the yen barely moved at USD/JPY 157.99. That split has a direct balance-sheet effect on SNSUC's transshipment structure.

The seven-grade book is typically bought in USD and settled in the destination currency — CNY when selling to Chinese refiners, KRW when selling to Korean end-users. When the local currency appreciates against the dollar, the USD cost of a tonne stays put but the local-currency revenue converts back into more dollars, passively widening delivered margin. On a 500,000-barrel ESPO cargo, a 0.7% yuan appreciation adds roughly $0.35m of conversion gain.

The ledger cuts both ways, though. Local-currency strength also makes the next USD purchase relatively more expensive if the procurement side buys USD with local currency. The mature fix is CIPS direct clearing: settle CNY or KRW straight through CIPS, removing the double conversion and correspondent-bank fees of the USD leg entirely.

What remains is timing exposure. Between purchase and sale there is a days-to-weeks transit window, and that gap is hedged with NDFs. With KRW moving almost 0.45% intraday, an unhedged cargo can lose several margin points to FX in a single week.