FUJAIRAH DATA: Oil product stockpiles climb to three-week high

Stockpiles of oil products at the UAE's Port of Fujairah climbed to a three-week high as of July 31 after a 22% jump in gasoline and other light distillates from a week earlier, according to Aug. 2 data from the Fujairah Oil Industry Zone.

Total inventories rose 5.1% on the week to 19.720 million barrels as of July 31, the highest since July 10, the FOIZ data provided exclusively to S&P Global Commodity Insights showed. Total inventories are down 4.6% since the end of 2022.

Oil product exports from Fujairah averaged an estimated 652,000 b/d in July, the highest since December, according to Kpler data. Singapore was the top destination at 144,000 b/d, followed by Malaysia at 65,600 b/d, South Korea at 59,300 b/d and Saudi Arabia at 43,600 b/d, the data show. Imports averaged 751,000 b/d in July, led by 197,000 b/d from Iran, 176,000 b/d from Iraq and 174,000 b/d from Russia, according to Kpler.

Light distillates stocks jumped to 7.582 million barrels as of July 31, a three-week high. Heavy distillates, used as fuel oil for power generation and shipping, dropped 2.4% over the week to 9.493 million barrels after jumping 24% in the previous week. Stocks of middle distillates such as diesel and jet fuel fell 5.9% to 2.645 million barrels, a three-month low and the fourth consecutive weekly decline, according to the data compiled by S&P Global since 2017.

A recent uptick in end-users' low sulfur fuel oil bunker requirements since end-July was likely to have drawn down Fujairah's inventories, whereas sentiments in the high sulfur fuel oil market was seen largely mixed, according to local traders Aug. 2.

Demand for low sulfur fuel oil has picked up recently, possibly helping to push down inventories, while the high sulfur fuel oil market is mixed, traders said. Also, the number of unused LSFO barges used to transfer fuel to ships for prompt deliveries has dwindled with the uptick in demand, they added.

"For [refueling dates] up till Aug. 10, there's decent prompt [LSFO bunker] premiums on a delivered basis, while demand is also decent," a Fujairah-based bunker supplier said. Fujairah has about 60 barges for LSFO and HSFO fueling, including floating storages, traders said.

Platts, part of S&P Global, assessed the Fujairah-delivered marine fuel 0.5% sulfur bunker premiums over the benchmark FOB Singapore marine fuel 0.5% sulfur cargo values at an average $9.01/mt for the week ended July 28, up from $6.35/mt a week earlier, and was at $9.18/mt on Aug. 1.

The high sulfur fuel oil market is not as strong as LSFO, and some traders are having no issues filling orders, Fujairah-based traders said.

"There's wide variations among the HSFO players, in terms of pricing and earliest delivery slots," a Fujairah trader said. Some suppliers can fill orders right away while others can only fill orders after a week, a trader said.

The Platts Fujairah-delivered 380 CST HSFO bunker premium over the FO 380 CST 3.5% FOB Arab Gulf cargo assessments averaged $10.20/mt since the week started July 31, down from the $11.17/mt during the week ended July 28, S&P Global data showed.

Middle distillates stocks are now down 14% so far in 2023. Light distillates have climbed 1.5% while heavy distillates have fallen 4.6% over the same period.