Oil products stockpiles at the Fujairah trading hub in the UAE ended 2019 with their biggest annual gain, led by a more than doubling in middle distillates such as jet fuel, reports Platts.
Significant decline in oil products
Total volumes in the port rose 7% for the year to 18.568 million barrels after a 2.3% gain in 2018 and a 12% drop in 2017, according to data from the Fujairah Oil Industry Zone and compiled by S&P Global Platts. The figures updated showed a 16% decline for the week to Monday, December 30.
Single-site underground reserve
Fujairah is building a shipping hub with storage of marine and aviation fuels and other oil products along with crude, with Abu Dhabi’s state-run ADNOC constructing the world’s biggest single-site underground crude reserve in caverns there to hold up to 42 million barrels of oil by 2022.
ADNOC is also expected to start trading crude products there later this year following the opening of a Fujairah office by Aramco Trading last year as both companies capitalize on the eastern UAE emirate’s position outside the Strait of Hormuz where tankers were attacked last year.
IMO regulations in motion
Fujairah is expanding just as the IMO 2020 rule takes effect, requiring ships to use fuel that has no more than 0.5% sulfur, compared with 3.5% previously.
Fujairah plans to conduct spot checks this year on ships taking bunker fuel to make sure they comply with the new rule, the port’s general manager, Captain Mousa Murad, told Platts last month.
Marine fuels stockpile
Marine fuel and other heavy distillate stockpiles at Fujairah climbed 62% last year to 10.079 million barrels, the first annual gain after declines of 40% in 2018 and almost 3% in 2017. They declined 10% in the final 2019 week to December 30, according to the FOIZ data.
The category covers heavy distillates and residues, including fuels used for power generation. It does not include non-energy residual products such as tar, bitumen and lubricants, according to FOIZ.
Distillates take a dip
Middle distillate stockpiles tumbled 24% in the final week to 3.724 million barrels. Inventories were still 155% higher for the year, after falling 22% in 2018 and 45% in 2017.
- The category includes jet fuel, kerosene, gasoil, diesel and marine bunker gasoil.
Light distillates was the only category to show an inventory decline for 2019, tumbling 51% after more than doubling in 2018 and declining almost 15% in 2017.
- The category includes gasoline, gasoline blending components such as reformate and alkylate, naphtha and other light petrochemical feedstocks and condensates that are stores in white products tanks and are of an API of 45 degrees and above.
Light distillates stocks tumbled 22% in the week to December 30, according to FOIZ.
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