Dubai — Oil products stockpiles at the UAE's eastern port of Fujairah fell to a seven-week low as of June 29, capping the first monthly decline since March.
Total stocks dropped 5.7% over the week to June 29, at 28.495 million barrels, the biggest weekly decline since April 20, according to data released on July 1 by the Fujairah Oil Industry Zone. The total was down 7.2% for June, after swelling 17% in May and 7.7% in April, data compiled by S&P Global Platts showed. Platts is the official publisher of the inventory data, which began in January 2017.
Stockpiles had set three record highs in May alone and another high in June, as signs of demand destruction from COVID-19 hit transportation fuels from gasoline to marine gasoil and jet fuel. Driving activity in recent days in Riyadh, Saudi Arabia, is back to levels before the virus in January, according to mobility data from Apple. Emirates and Etihad Airways resumed passenger flights in June as the UAE eased travel restrictions.
"Economies are picking up so the consumption is there," said Malek Azizeh, commercial director of Fujairah Oil Terminal, July 1 on a Gulf Intelligence webinar. Azizeh also added that Fujairah Oil Terminal is looking to finalize plans to connect its entire terminal, including crude oil tanks, to the VLCC jetty -- Matrix Manifold 2 of Port of Fujairah -- and add about 10% of existing storage capacity for oil products within the next two years. The investment could be $80 million to $100 million, he said.
Stocks of light distillates, including gasoline and naphtha and other light petrochemical feedstocks, dropped 4% over the latest week at 7.919 million barrels, bringing the decline to about 7% for June. That was the first monthly drop since March.
Middle distillates, also including gasoil, diesel, marine bunker gasoil and kerosene, tumbled 19% at 4.102 million barrels, the lowest since April 20. Stocks plunged 32% for June after more than doubling the previous two months.
Heavy distillates and residues fell 3% over the latest week at 16.474 million barrels. The category, which covers fuels used for power generation and bunkers, was the only one to show increased stockpiles in June at a gain of 1.9%, the second consecutive monthly advance.