FUJAIRAH DATA: Oil product stocks fall as fuel oils shrink

Oil products inventories at the UAE's Port of Fujairah dropped 8.6% in the week ended Aug. 11 after climbing 12% the week before, with declines led by fuel oils as shipments to Malaysia and South Korea headed for record highs, according to Fujairah Oil Industry Zone data published Aug. 13 and the latest shipping figures.

The total fell to 17.427 million barrels, a two-week low. Stockpiles are now 12% higher than at the end of 2024.

Heavy distillates used as fuel oils for power generation and shipping dropped 23% to 7.416 million barrels, a two-month low, wiping out the 22% gain from the prior week. The drop left fuel oil inventories down 1.2% compared with the end of 2024.

Light distillates, such as gasoline and naphtha, expanded 8.8% to 7.766 million barrels, a three-week high and exceeding fuel oils for the first time since June 2. Middle distillates, such as jet fuel and diesel, dropped 1.4% to 2.245 million barrels.

Middle distillate stocks are still 14% higher than at the end of 2024, while light distillates are up 28% over the same period.

Product exports

Preliminary refined products exports from Fujairah are averaging 696,000 b/d in August, down from 714,000 b/d in July, according to S&P Global Commodities at Sea. Fuel oil shipments are heading for record highs to South Korea, at 171,000 b/d, and to Malaysia, at 138,000 b/d, according to the data.

Traders said demand for both low and high-sulfur fuel oils picked up toward the end of the reporting period, and more buyers were able to take advantage of deliveries via bunkering ships, speeding up sales.

They said suppliers were mainly seeing more LSFO inquiries from shipowners than HSFO inquiries. Historically, HSFO demand was stronger than LSFO, even though LSFO makes up the bulk of sales.

That has since slowed in recent days, according to traders.

The market "was busier late last week; we had good demand," with fixtures booked up through Aug. 20, a Fujairah-based trader told Platts, part of S&P Global Energy. "HSFO flow was slightly slower compared to LSFO."

The Platts-assessed Fujairah-delivered 380 CST HSFO bunker premium to the 380 CST 3.5% sulfur FOB Arab Gulf fuel oil cargoes averaged $12.38/mt so far in August, down from $14.91/mt in July. The premium dropped to an eight-week low of $7.77/mt on Aug. 12.

Traders said LSFO demand is lagging supply, and they are keen to unload LSFO supplies in as soon as one day, keeping prices under control. Recently, barging schedules were mostly available for refueling requirements within eight days.

The Platts-assessed Fujairah-delivered LSFO marine fuel premium over the FOB Singapore cargo values averaged $4.80/mt so far in August, up from $4.77/mt in July.