Stockpiles of oil products at the UAE’s Port of Fujairah witnessed a notable rise of 5.9% in the week ending February 5, attributed to the first fuel oil import from Kuwait in 2024. The data, sourced from the Fujairah Oil Industry Zone (FOIZ) and shipping data, sheds light on shifting dynamics within the region’s energy sector.Rising Inventory Trends
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- Total stockpiles surged to 18.755 million barrels, marking an 8.2% increase since the end of 2023.
- Heavy distillates used for power generation and shipping reached a five-week high, reflecting a 7.9% climb.
Kuwait’s Growing Influence
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- The influx of fuel oil from Kuwait, notably from its Al-Zour refinery, contributed significantly to the rise in stockpiles.
- Kuwait Petroleum Corp.’s increased production capacity, reaching its full potential at 615,000 b/d, underscores its role as a major fuel oil supplier.
Market Disruptions and Weather Impacts
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- High winds at the port since February 2 disrupted refuelling operations, exacerbating the buildup in heavy distillates stockpiles.
- Suppliers and shipowners experienced delays and postponements in operations and orders due to adverse weather conditions.
Price Fluctuations and Trading Patterns
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- Premiums for marine fuel 0.5% and high sulfur fuel oil (HSFO) witnessed fluctuations amid changing market dynamics and weather-related disruptions.
- Overall product imports surged to 5.25 million barrels, while exports reached 6.8 million barrels, highlighting the region’s significance in global energy trade.
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The developments at Fujairah Port reflect the intricate interplay of market forces, weather impacts, and geopolitical influences shaping the dynamics of the global oil trade.
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Source: S&P Global
