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Improved fuel oil outflows from the Black Sea to help Med supply

Thursday, 16 February 2012 | 00:00
The fuel oil supplies from the Black Sea into the Mediterranean that were delayed for over a week by logistical constraints caused by strong winds and freezing temperatures in Russia and Ukraine have been steadily improving, sources said.
"The fuel oil has started to flow but there is still some backlog," a fuel oil trader in the Mediterranean said.
"I don't see any delays from the Black Sea for the time being. We have our [loading] terminal in Sevastopol [Ukraine] and the loadings are very smooth," another fuel oil trader in the Med said. The source added that she saw a "lot of [fuel oil] loadings from the Black Sea ports including Odessa, Nikolaev and Kerch on big vessels" to be blended in the Mediterranean market.
She said fuel oil supplies from Odessa and Nikolaev were directed to the Mediterranean market while most of the high sulfur fuel oil cargoes were heading to the Asian markets.
Last week, the fuel oil and crude oil loading hubs including Novorossiisk in the Black Sea were closed due to gale force winds resulting in big delays for exports, sources said.
Oil products supplies to the Black Sea ports were also hampered as inland freezing temperatures disrupted deliveries, sources said.
The increase in the fuel oil outflows from the Russian and Ukrainian hubs was expected to ease the supply availability in the Mediterranean that was keeping high sulfur fuel oil prices firm, sources said.
"I think [the Mediterranean] is more or less balanced [as] product [is coming] out of Black Sea and Turkey," a third fuel oil trader said.
Source: Platts
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