FUJAIRAH DATA: Oil product stocks rebound from 8-month low, led by jet fuel group

Oil product inventories at the UAE's Port of Fujairah climbed 3.3% in the week ended Aug. 25, led by a 23% increase in jet fuel and other middle distillates, according to Fujairah Oil Industry Zone data published Aug. 27.

The total rose to 16.009 million barrels after falling to the lowest level since the record low on Nov. 25, 2024. Stockpiles are up 3% since the end of 2024.

Stockpiles of middle distillates jumped to 1.886 million barrels from a two-month low a week earlier, erasing the year-to-date drop and resulting in a 4.2% gain.

Heavy distillates used as fuel oil for shipping and power generation increased 5.6% to 6.463 million barrels from the lowest level since Dec. 15, 2018, a week earlier. They are now down 14% since the end of 2024.

Light distillates such as gasoline and naphtha declined 2.3% to 7.660 million barrels, marking the first drop in four weeks, but still exceeding fuel oil for the third consecutive week. They are 26% higher than at the end of 2024.

Preliminary refined product exports from Fujairah are averaging 551,000 b/d in August, down from 667,000 b/d in July, according to S&P Global Commodities at Sea. Fuel oil is the top export at 222,000 b/d, followed by gasoline at 107,000 b/d and gasoil/diesel at 106,000 b/d.

Healthy demand

High-sulfur fuel oil stockpiles were mostly adequate for the near term, while brisk demand also supported downstream premiums, according to traders.

Barge availability for prompt HSFO delivery for balance-August dates was thinner than usual as sellers filled some early slots; however, schedules for early September refueling were mostly ample.

Since the trading week started Aug. 25 and over the past weekend, at least three HSFO replenishment cargoes -- ranging from Medium-Range to Long-Range 1-sized shipments and reportedly sourced from within the Middle East -- have recently found homes around the Fujairah hub, according to industry sources.

The Platts-assessed Fujairah-delivered 380 CST HSFO bunker premium to the 380 CST 3.5%S FOB Arab Gulf fuel oil cargoes weakened to an average of $12.40/mt in August, as of the 26th, compared with $14.91/mt in July.

The supply situation in the low-sulfur fuel oil segment has been mixed among downstream sellers recently, depending on market participants' upstream cargo sources and suppliers.

Procurement of key feedstocks such as Dar blend crude has reportedly been delayed, resulting in logistical bottlenecks at the Fujairah hub and affecting some local suppliers who require ex-wharf parcels for their downstream supply.

Prompt LSFO supply stocks were leaner, supporting higher delivered premiums, while suppliers extended their lead times due to limited availability for buyers' early refueling nominations.

The Platts-assessed Fujairah-delivered LSFO marine fuel premium over the FOB Singapore cargo values strengthened to a near six-month high of $13.47/mt on Aug. 26, up $2.80/mt day over day. The premium was previously assessed higher at $14.03/mt on March 4.

Due to leaner LSFO supply, bunker premiums have increased to an average of $6.65/mt so far in August, compared with $4.77/mt in July.