High fuel oil stocks have prompted traders to fuel oil temporarily in VLCCs as regional demand slows.
According to Reuters, at least seven VLCCs have been fixed to store fuel oil on short-term time charters. As a result of lower oil prices, refinery profits have been boosted resulting in refiners to increase the supply of fuel oil, including shipping and feedstock fuel, in the region.
Traders are also continuing to maximize the deepening market contango, which is effectively paying for oil to be stored on floating storage.
Of the vessels storing fuel oil, the majority have been fixed for between 30 and 90 days.