FUJAIRAH DATA: Oct. bunker sales jump 22.1% on month, hitting high for 2021

Bunker fuel sales in October at the UAE's Port of Fujairah jumped 22.1% on the month, with LSFO volumes exceeding trader expectations, as buyers who had waited for crude oil prices to fall were forced to meet their requirements.

The total at the world's third-biggest bunkering hub was 782,060 cu m, the most this year and surpassing the previous high of 707,563 cu m in August, according to Fujairah Oil Industry Zone data published on its website on Nov. 18. LSFO sales hit 606,666 cu m, up 24.3% from September, well above the 5%-10% gain expected by traders polled by S&P Global Platts.

Buyers had put off purchases during most of September in hopes that crude oil prices would soften but could wait no longer to meet their vessels' requirements in October, traders said.

The benchmark FOB Singapore marine fuel 0.5%S cargo assessments averaged $593.19/mt in October, up $51.65/mt from the September average, Platts data showed. The average for Nov. 1-17 was still higher at $602.17/mt, according to the data.

Cyclone Shaheen, which led to the imposition of a three-day disruption in bunkering activities at the port in early October, was not enough to curb sales for the month as buyers anxious about the disruption booked quantities even before vessels arrived, thus pushing up prompt delivered bunker premiums, industry sources said.

According to Platts data, the premiums of Fujairah-delivered marine fuel 0.5%S over the FOB Singapore marine fuel 0.5%S cargo assessments averaged $10.63/mt in October, well above September's average of $2.10/mt. The premium averaged $18.74 on Nov. 1-17, indicating demand is still strong, the data showed.

"Throughout October and November, there is no lack of prompt inquiries seen. This is likely due to unexpected vessel requirements amid the pandemic-related supply chain disruptions, which had upended freight schedules," a Fujairah-based bunker supplier said.

The bunker supplier also said that freight traffic at the port is expected to remain steady throughout the rest of this year.

"Under a high freight rate environment, port delays can be very costly while freight bookings can be unprecedented. It is normal that shipowners swap vessels along various routes and adjust schedules accordingly, resulting in prompt bunker-only calls requirements," a source from a shipping company said.

High sulfur fuel oil sales at Fujairah in October climbed 13.77% on the month to a 2021 high of 135,150 cu m, according to the FOIZ data.

"HSFO barges have been kept very busy filling orders since October, to the extent that suppliers are capping the nominations to not overstretch barge capacities. Otherwise, demurrages arising from delays can be very costly," a bunker supplier said.

"Fujairah has seen an increase in bunkering calls from scrubber-fitted vessels which require large parcels. HSFO suppliers are stretched quite thin due to the surge in demand since October which has continued into November," a Fujairah-based trader said.