FUJAIRAH DATA: Oil product stocks rebound from four-month low

Stockpiles of oil products at the UAE's Port of Fujairah climbed 13% in the week ended Feb. 26, rebounding from a four-month low a week earlier amid signs of a slowdown in exports of some light distillates, according to the Fujairah Oil Industry Zone and shipping data.

The total stocks rose to 18.734 million barrels as of Feb. 26, the FOIZ data published Feb. 28 showed. Stockpiles have increased 8.1% since the end of 2023.

Stocks of heavy distillates used as fuel oil for power generation and shipping rose 12% to 9.316 million barrels, after falling to a seven-month low a week earlier. Light distillates such as gasoline and naphtha jumped 24% to 7.777 million barrels, the highest in eight months. Middle distillates, including jet fuel and diesel, dropped 20% to 1.641 million barrels, the lowest since Oct. 16. So far since the end of 2023, stocks of light distillates have ballooned 66% after a 55% surge in the first week, while those of middle distillates and heavy distillates declined 34% and 8.1%, respectively, over the same period.

Exports of products -- except fuel oil -- declined for the third straight week to an estimated 1.96 million barrels in the week ended Feb. 25 from 2.3 million barrels a week earlier, according to S&P Global Commodities at Sea data. Shipments were down over the latest week for gasoline and blendstocks, along with naphtha. However, fuel oil shipments surged to 2.1 million barrels from 276,000 barrels over the same period.

Over the recent couple of weeks, bunker barge reloading operations at Fujairah's terminals were delayed due to rough weather events, which was likely to have slowed overall stock draws, traders said Feb. 28.

Suppliers were reportedly hurrying to clear the mounting backlogs amid deferred bunker deliveries, posing further downside risk to downstream demand for the near term, according to local traders.

"Due to the backlog [of orders] with some ongoing bad weather, most sellers are offered toward the end of the first week of March to err on the side of caution. Some might supply earlier with [steeper] premiums," a Fujairah-based trader said Feb. 27.

Around the offshore regions of the UAE, forecasts for strong winds and sea swells as high as 6-9 feet over March 1-2 might hamper refueling operations, though easing weather conditions are likely throughout Feb. 28-29, according to the latest report by the UAE's National Center of Meteorology Feb. 28.

The Platts Fujairah-delivered marine fuel 0.5% sulfur bunker premium over benchmark FOB Singapore marine fuel 0.5%S cargo values slipped to a near four-week low of $10.15/mt on Feb. 26, down $2.13/mt on the day, S&P Global Commodity Insights data showed.

Meanwhile, demand in the high sulfur fuel oil market was seen leaner than before, spurring some sellers to show "very competitive" offers in the downstream market to capture end-users' forward requirements, according to local bunker suppliers.

"The HSFO market has been slower," a trader said.

The Platts-assessed Fujairah-delivered 380 CST HSFO bunker premium over the FO 380 CST 3.5% FOB Arab Gulf cargo averaged $21.93/mt over Feb. 26-27, below the $22.11/mt across the previous week ended Feb. 23, according to data by S&P Global.