FUJAIRAH DATA: Oil product stocks extend drop, heavy distillates at eight-month low

Oil product stockpiles at the UAE's Port of Fujairah dropped 2.6% in the week ended Feb. 13, extending their slide to a nine-month low with heavy distillates now at an eight-month low, according to Fujairah Oil Industry Zone data published Feb. 15.

The total inventory was 17.17 million barrels on Feb. 13, the lowest since May 2, 2022. Heavy distillates -- used as fuel for power generation -- and marine bunkers dropped 4.4% to 8.158 million barrels, the lowest since June 13, 2022.

Fuel oil exports more than doubled to 3.3 million barrels in the week started Feb. 6, with 2.075 million barrels headed for Singapore, the first fuel oil shipment to the island state in four weeks, according to Kpler shipping data.

Middle distillates bucked the trend, and rose 5.7% to 1.828 million barrels, the first increase for the category in four weeks. Jet fuel, kerosene, diesel and marine gasoil are included in middle distillates.

Light distillates including gasoline and naphtha dropped 2.4% to 7.184 million barrels, a two-week low.

Demand has inched up for HSFO bunkers, helping reduce the heavy distillates inventories, while demand for low sulfur fuel for shipping is lower, traders said, with one source saying LSFO demand is "quite poor."

"HSFO bunker demand is getting better lately," a Fujairah bunker supplier said. "Many suppliers and other players are all battling [for inquiries] too, while sellers are also able to offer up for prompt deliveries."

The recent improvement in HSFO demand has led suppliers to increase the frequency of barge refueling at terminals, leaving lead times within three days, the Fujairah bunker supplier said.

HSFO premium

Platts, part of S&P Global Commodity Insights, assessed the Fujairah-delivered 380 CST high sulfur fuel oil bunker premium over the FO 380 CST 3.5% FOB Arab Gulf cargo at $29.19/mt Feb. 13-14, compared with $24.96/mt during the week ended Feb. 10.

That compares with the Platts-assessed Fujairah-delivered marine fuel 0.5%S bunker premiums over the benchmark FOB Singapore marine fuel 0.5%S cargo at $14.08/mt Feb. 1-14, almost half of the $27.25/mt figure across January, the data showed.

Even with stockpiles at an eight-month low, bunker supplies are considered ample, if not oversupplied, traders said.

Total oil product inventories at Fujairah are down 17% since the end of 2022, led by a 41% plunge in middle distillates. Heavy distillates are down 19% over the same period and light distillates have dropped 3.8%.