FUJAIRAH DATA: Oil product stockpiles fall to three-week low

Stockpiles of oil products at the UAE's Port of Fujairah dropped to a three-week low Aug. 7 after middle distillates such as jet fuel and diesel fell 17% from a week earlier to 2.199 million barrels, the lowest since Feb. 27, according to Aug. 9 data from the Fujairah Oil Industry Zone.

Total inventories fell 6.1% on the week and 10% since end-2022 to 18.516 million barrels as of Aug. 7, the lowest since July 17, FOIZ data provided exclusively to S&P Global Commodity Insights showed.

Over the week, while stocks of middle distillates dropped for a fifth consecutive week, the most on record since S&P Global began compiling the data in 2017, light distillates such as gasoline and naphtha climbed 0.8% to 7.642 million barrels, marking the third weekly gain in a row.

Stocks of heavy distillates, used as a fuel oil for power generation and shipping, dropped 8.6% over the week to 8.675 million barrels, a three-week low.

Oil product exports, excluding fuel oil from Fujairah, averaged an estimated 538,000 b/d in July, a two-month low, according to S&P Global Commodities at Sea data. Singapore was the top destination at 159,000 b/d, followed by Malaysia at 106,000 b/d, the data showed.

Fuel oil exports averaged 222,000 b/d in July, the most since November. Egypt, which received the first such shipment since November from Fujairah, was the biggest receiver of fuel oil at 41,000 b/d, the data showed. For August, the country is already destined to acquire 60,000 b/d of fuel oil from the UAE port.

Bunker demand

Demand for ship fuel at the port has improved in recent weeks, with premiums for low sulfur fuel oil widening, traders said. Platts-assessed Fujairah-delivered marine fuel 0.5% sulfur bunker premiums over the benchmark FOB Singapore marine fuel 0.5% sulfur cargo values rose to average $6.75/mt over Aug. 1-8 from $5.47/mt for July, S&P Global data showed.

However, as LSFO barge availability for refueling has improved recently, it has helped to push down lead times to as little as two days, bunker suppliers said.

An LSFO shipment of about 447,000 barrels, originating from Kuwait's Al-Zour refinery, was discharged at Fujairah Aug. 7, reflecting the first such shipment since May 29, according to Kpler data.

HSFO supplies remain ample, traders said, adding that suppliers are keen to move cargoes.

"Demand is not bad, but the competition is too intense," a Fujairah-based bunker supplier said. "Sometimes, [delivered] fixing levels stayed far below [ex-wharf] cargo levels."

The Platts Fujairah-delivered 380 CST HSFO bunker premium over the FO 380 CST 3.5% FOB Arab Gulf cargo assessment fell to $2.50/mt Aug. 4, the lowest in more than eight months, before inching up to $4.09/mt Aug. 8, S&P Global data showed.

Middle distillate stockpiles at Fujairah have fallen 29% so far in 2023. Although light distillates have climbed 2.3%, heavy distillates have fallen 14% over the same period.

Platts is part of S&P Global Commodity Insights.