Oil product inventories at the UAE’s Port of Fujairah remained relatively stable in the week ending May 5, as a rise in gasoline and light distillates offset declines in fuel oils and middle distillates, according to data from the Fujairah Oil Industry Zone released on May 7.
Total oil inventories increased by 0.1%, reaching 20.742 million barrels, up from a one-month low a week earlier. Middle distillates saw a significant drop of 20%, falling to 1.730 million barrels, marking a seven-month low. Heavy distillates, used for power generation and ship fuel, decreased by 2.6% to 10.462 million barrels, also a six-week low.
Meanwhile, light distillates, which include gasoline, rose to 8.550 million barrels, recovering from the previous week’s one-month low.
Fuel oil exports from Fujairah are expected to reach a record pace in May, averaging 1 million barrels per day (b/d), up from 272,000 b/d in April, according to data from S&P Global Commodities at Sea. A substantial 679,000 b/d of fuel oil is heading to China, the highest amount ever recorded, compared to a monthly average of below 100,000 b/d since at least 2016. Shipments to Singapore reached 155,000 b/d, the highest since June 2023, while shipments to Saudi Arabia have been halted after three consecutive months of imports.
In a turn of events, Saudi Arabia shipped 17,000 b/d of fuel oils to Fujairah in May. Other countries such as Iraq, Russia, Kuwait, and Oman have also contributed fuel oils to the UAE port this month.
The Middle East is experiencing a surge in electricity demand as power plants ramp up production to meet air conditioning needs, with temperatures in Dubai exceeding 100°F for much of the past month. ADNOC Gas has benefitted from the high temperatures, as they have boosted natural gas sales for power generation.
The price for 0.5% sulfur fuel oil delivered to Fujairah was assessed at $483 per metric ton (mt) on May 6, down from $497/mt on April 23, and from the year’s peak of $594/mt on January 17. Similarly, the price for high sulfur fuel oil delivered to Fujairah stood at $396/mt on May 6, nearing its lowest point of $388/mt in April.
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