Total oil product stocks in Fujairah were 16.712 million barrels as of Monday, March 8, up 4.6% on the week, after heavy distillates rebounded from last week’s record lows, according to latest data from the Fujairah Energy Data Committee, or FEDCom.
Stocks of heavy distillates and residues jumped 34.3% on the week to 6.5 million barrels. This is after stocks tumbled a week earlier to a record low of 4.84 million barrels, S&P Global Platts Analytics said in a report. Bunker demand in Fujairah was reported as firmer, with market sources noting that inquiries and trade volumes have picked up in recent days. Fuel oil cargoes moving from the Middle East to Asia in March are estimated at 2 million mt, down from volumes of around 2.5 million mt in January and February, sources said.
Lower arbitrage volumes are consistent with the narrower spread between Singapore and Fujairah cargo prices since around mid-February. Meanwhile, stocks of light distillates fell 9.3% to 7.642 million barrels, the data showed. The Middle East petrol market showed some improvement, with both time spreads and cash premiums seeing some improvement on the week, the report said. Spring refinery maintenance is expected to tighten global supply balances, although weakness in the US petrol complex continues to weigh on sentiment, it added.
Stocks of middle distillates also fell 5.2% to 2.571 million barrels, staying rangebound on refinery maintenance in the Middle East and tepid demand fundamentals in Asia and Europe. Premiums for FOB Arab Gulf gasoil 500 ppm were at a 12-month low Tuesday.
Middle East jet export barrels remain well supported by demand from Asia, East Africa, and Europe. The Singapore market has recently seen heavy buying drive prompt jet fuel cash differentials to a 10-year high, but demand is expected to wane during the April-May shoulder season. Demand for jet kerosene stocks in the Gulf remained consistent, with the Emirates General Petroleum Corp. heard seeking 50,000 mt of jet A-1 fuel for mid-April delivery to Jebel Ali.