- Heavy distillates up in five out of past six weeks
- Middle, light fuels also see inventory gains
- Middle East on Eid holidays starting May 2
Oil product stocks in the UAE port of Fujairah rebounded from a three-week low ahead of the Eid holiday as of May 2, reports Platts quoting data from the Fujairah Oil Industry Zone.
Oil inventories rise
Total inventories rose 798,000 barrels, or 5%, week on week to stand at 16.886 million barrels with light, middle and heavy products all showing gains, according to the data provided exclusively to S&P Global Commodity Insights.
Stocks of heavy distillates and residues used as fuels for power generation and marine bunkers rose 1.8% to 11.268 million barrels and have built in five out of the last six weeks.
Pakistan, which typically buys high sulfur fuel oil from Fujairah, took in 30,056 mt of the fuel from Singapore for the first time in eight months, according to Enterprise Singapore data.
But market sources said Fujairah was seeing improved bunker fuel demand, and Saudi Arabia is likely to ramp up fuel oil purchases for electricity generation as the weather turns hotter toward summer, potentially increasing the pull for heavy distillates in Fujairah.
Fuel oil exports out of Fujairah to the US may also rise, with sanctions hitting supplies out of Russia.
Some 1.06 million barrels of fuel oils were set to be exported out of Fujairah to the US in the week started April 18, only the second such shipment since at least June 2020, according to shipping data.
Fujairah middle distillates
Stocks of middle distillates in Fujairah, including jet fuel and diesel, rose 22.7% to 1.560 million barrels, according to the FOIZ data, even as traders said the gasoil market continued to see steep backwardation, which typically discourages market participants from putting volumes into storage.
Light distillate stocks, including gasoline and naphtha, stood at 4.058 million barrels, up 8.2% on the week, the data showed.
The return of Middle East traders from the Eid holiday could see more buying and selling interest in the weeks ahead.
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