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31 May 2023

Fujairah Oil product stocks down 2.9%


Oil product stocks at the Middle East's key oil hub of Fujairah fell 2.9 percent in the week to Monday, slipping to a five-week low as light distillate inventories lost more ground.

Total oil stocks sank to 18.739 million barrels, down 559,000 barrels from a week earlier, according to the Fujairah Energy Data Committee.

The biggest decline was in light distillate stocks, which dropped 10.35 percent to 5.741 million barrels, the lowest since the start of the year, the data showed.

"Middle Eastern gasoline demand appears steady, while African demand is picking up on the evidence of recent tender purchases from South Africa, Tanzania and Kenya," S&P Global Platts Analytics said in a report yesterday.

State-owned Kuwait Petroleum Corp. continued to be an active buyer of gasoline, seeking 25,000 mt of RON 91 gasoline for delivery in late August via a tender closing this week, the reported added.

Spot premiums for Arab Gulf RON 95 gasoline were at US$3.95/b Tuesday.

Stocks of middle distillates also slipped 1.2 percent to 2.676 million barrels, an eight-week low.

"Arbitrage of jet fuel and gasoil to Europe could be complicated by the recent attack by Yemeni Houthi rebels against two Saudi crude tankers. The route to the Red Sea from the Indian Ocean passes through the Gulf of Aden and the narrow straits known as the Bab al-Mandab", Platts Analytics said.

While there has been no sign of any impact to product tanker movements, the incident adds a further complication to already squeezed arbitrage flows. Jet cargoes have already been seen heading from the Middle East and India eastwards to Singapore instead of Europe.

Stocks of heavy distillates and residues rose 1.3 percent to 10.322 million barrels, staying above 10 million barrels for the second week in a row and hitting the highest since 11th December last year.

The higher inventories in Fujairah are in contrast to Singapore, where residue stocks dropped to a 6 1/2-year low of 16.196 million barrels last week on continued low arbitrage supply. Fujairah bunker demand had a slight improvement compared to last week, with more buying inquiries emerging after the recent lull.

S&P Global Platts holds exclusive rights to publish Fujairah oil inventory data and has deployed a blockchain network for its collation.