Fujairah Data: Oil Product Inventories Decline to Record Low Amid Reduced Fuel Oil Supply

• Total inventories have declined by 16% year-to-date.
• Fuel oil shipments from Iraq to Fujairah have decreased.
• Premiums for low-sulfur fuel oil have risen sharply.

Oil product inventories at the UAE’s Port of Fujairah declined to a record low on September 15, with ship fuel stocks falling to their lowest level in nearly seven years, according to data from the Fujairah Oil Industry Zone released on September 17.

Total inventories dropped 18% to 13.089 million barrels for the week ending September 15, representing the lowest level since January 2017 and a 16% decline compared with year-end 2024. Heavy distillates, primarily used for shipping and power generation, fell 24% to 5.390 million barrels, the lowest since December 2018, and are down 28% year-to-date. Middle distillates, including jet fuel and diesel, decreased 24% to 1.651 million barrels, while light distillates fell 10% to 6.048 million barrels, erasing previous gains.

Supply constraints have been linked to reduced shipments of Dar Blend crude from South Sudan, impacting refineries at the port. The Montfort refinery has suspended operations, and no crude shipments have arrived from Sudan in September due to the ongoing conflict. Additionally, Iraq’s bunker feedstock supplies have declined, with fuel oil shipments reaching their lowest levels since October 2020.

Looking ahead, increased fuel oil supplies are expected from West Africa. High-sulfur fuel oil (HSFO) demand remains robust, driving premiums higher, while demand for low-sulfur fuel oil (LSFO) has softened following recent price increases.

Source: S&P Global Commodity Insight