Oil product stocks at the Middle East’s key oil hub of Fujairah slipped another 2.5% in the week to Monday, hitting a new 10-week low, despite a jump in middle distillate inventories.
Total oil stocks were 17,665 million barrels, down 449,000 barrels from a week earlier, according to the Fujairah Energy Data Committee.
Stocks of middle distillates jumped 20% to 3.521 million barrels, the highest since last August.
Middle distillates appear to be gaining momentum as the crack for Singapore gasoil against Dubai rose to a 12-week high of over $16/b, S&P Global Platts Analytics said Wednesday.
Indian gasoil exports remain strong, but should decline in the fourth quarter as the end of the rainy season leads to an upturn in domestic demand, Platts Analytics said.
At the same time, stocks of heavy distillates and residues fell 10.2% to 9.293 million barrels. Fujairah continues to see healthy bunker demand, with suppliers citing steady buying inquiries in recent days.
Delivered 380 CST bunker prices in Fujairah have averaged $8.40/mt below Singapore so far this month. Meanwhile, utility demand for fuel oil in the Middle East has shown signs of tapering off as summer draws to a close. Kuwait Petroleum recently issued a sell tender and Pakistan State Oil has reduced its HSFO requirements for September.
But Saudi demand is reportedly still pulling in European cargoes, Platts Analytics said.
Light distillate stocks totalled 4.851 million barrels, edging up 0.4% from the year’s lowest total last week.
Petrol sentiment appears to be diverging somewhat in the east of Suez. Premiums for Arab Gulf RON 95 petrol were down to a seven-week low of $3.50/b, although there should be continued support from regional demand. State-owned Egyptian General Petroleum and KPC were both seeking September petrol cargoes.
By contrast, Singapore premiums have climbed in recent days, boosted by Indonesia’s buying for September. Indonesia is expected to import some 11 million barrels of petrol in September, up 1 million barrels on the month.