FUJAIRAH DATA: Oil product stockpiles hit three-week high

Stockpiles of oil products at the UAE's Port of Fujairah, the world's third-largest bunkering hub and a major oil trading center, reached a three-week high as of June 5, with all categories showing gains from a week earlier, according to June 7 data from the port's Fujairah Oil Industry Zone.

Total inventories rose 4.8% on the week to 24.323 million barrels as of June 5, the highest since May 15, the FOIZ data provided exclusively to S&P Global Commodity Insights showed. Total inventories were up 18% since the end of 2022.

Heavy distillates used as fuel oil for power generation and shipping advanced 0.8% over the week to 12.090 million barrels, a three-week high. Fujairah's bunker sales in 2022 were 51 million barrels, the biggest after Singapore and Rotterdam.

Light distillates such as gasoline and naphtha increased 8.1% to 7.878 million barrels, a four-week high. Middle distillates such as diesel and jet fuel rose 11% to 4.355 million barrels, a two-week high, according to the data compiled by S&P Global since 2017.

Ship fueling demand for low sulfur fuel oil has "improved slightly" from a low base and at least two bunker suppliers have attempted to boost demand by offering "very low prices," traders said.

The Platts Fujairah-delivered marine fuel 0.5% sulfur bunker premium over the benchmark FOB Singapore marine fuel 0.5% sulfur cargo value averaged $7.78/mt over May 2-31, down from $11.34/mt for all of April, S&P Global data showed.

The Platts Fujairah-delivered marine fuel 0.5% sulfur bunker premium over the benchmark FOB Singapore marine fuel 0.5% sulfur cargo value fell a 20-month low of $3.53/mt on June 5, before rising to $5.56/mt on June 6.

High sulfur fuel oil demand was steady, and some sellers were making "aggressive offers" for prompt refueling, which may put even more pressure on Fujairah premiums over Arab Gulf cargo assessments, suppliers said. Singapore HSFO is already at a premium to Fujairah.

"Bunker demand is steadier, sometimes a handful of inquiries come in. But [sellers] are keen to shift cargoes due to the persistent status of oversupply [in bunker fuels]," a Fujairah-based trader said June 7.

The Platts Fujairah-delivered 380 CST HSFO bunker premium over the FO 380 CST 3.5% FOB Arab Gulf cargo assessment averaged $24.43/mt over June 1-6, down from $31.85/mt for all of May, according to data from S&P Global.

Oil product exports from Fujairah averaged an estimated 703,000 b/d in the week started May 29, up from 683,000 b/d a week earlier, according to S&P Global Commodities at Sea data. The latest week fuel oil destinations were, 64,000 b/d headed for Singapore and 88,000 b/d destined for Egypt, the largest such shipment on record, the data showed.

Heavy distillates inventories at Fujairah have gained 20% so far in 2023, light distillates increased 5.5%, while middle distillates climbed 41% over the same period.