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01 March 2024

Fujairah oil product stocks rise 2.5%

By Wam

Oil product stocks in the Middle East's key oil hub of Fujairah regained ground in the week to Monday, edging up 2.5 per cent with higher numbers for light and middle distillate inventories.

Total oil stocks were 18.098 million barrels, up 433,000 barrels from a week earlier, when inventories had dropped by a similar amount, according to the Fujairah Energy Data Committee.

Stocks of light distillates rose 11.5 per cent week on week to 5.41 million barrels, the data showed.

Regional supply balances have been tightened by the recent force majeure on gasoline exports by India's Reliance after an unplanned FCC unit shutdown at its Jamnagar refinery. Reliance is India's largest gasoline exporter and reduced supplies from India could lead the Middle East to source additional gasoline from Europe, S&P Global Platts Analytics said in a report Thursday.

Some of the impact is already being felt. Market sources noted a fixture by Saudi Aramco to lift 60,000 mt of gasoline from Suez to Jeddah, loading 27th August. This would add to West of Suez gasoline slated to land in the Middle East. Up to six LR1 tankers, which typically ship 60,000 mt parcels of gasoline, were slated to bring in European gasoline to the Gulf, the sources said.

Stocks of middle distillates also rose by 6.5 per cent to 3.749 million barrels, hitting the highest level since August last year.

Sentiment in the gasoil market has been bullish due to the Reliance force majeure, although there has been no indication of any impact on gasoil or jet supplies, Platts Analytics said.

Gasoil balances are expected to tighten over the next few months from the likes of India, Thailand and Vietnam due to a seasonal demand pick-up with the end of the rainy season in late September and October.

Elsewhere, jet fuel market participants were concerned about the Middle Eastern and Indian spot market, with economics to move cargoes either East or West of Suez remaining unattractive, Platts Analytics said.

Stocks of heavy distillates and residues fell by 3.8 per cent to 8.939 million barrels, the lowest level since the end of June.

Bunker activity in Fujairah was quiet this week due to the Eid holidays. Fujairah has seen healthy bunker demand in recent weeks, due in part to lower prices compared to Singapore. But a softer Singapore market has seen a sharp narrowing in that differential over the past week. Delivered 380 CST bunker prices in Fujairah were assessed at US $ 50 cents/mt below Singapore Wednesday, down from a spread of around US $ 9/mt a week ago.

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