Fujairah Benefits From Uptick In Russian Crude Transiting To The Bunkering, Storage Hub
The port of Fujairah on the UAE’s east coast is benefitting from an uptick in Russian crude transiting through the facility on its way to Asia, the port’s managing director said June 30, as Moscow sells more oil to countries, such as India and China.
“Russian crude has started to transit at the port because its market has changed,” Captain Mousa Murad told S&P Global Commodity Insights in an interview in Fujairah. “Some of the crude is being stored before it goes to the Asian market, India mainly. This is a new development from March. We expect it to increase.”
Russian crude accounted for 2% of overall crude imports into Fujairah in 2021 and 11% of the total in the first half of 2022, according to port data.
Russia sent 36% of its 4.99 million b/d crude exports to India and China in June, according to Kpler shipping data. That’s up from 19% in February, the month the war started.
India imported just 38,000 b/d of Russian crude in February, compared with 690,000 b/d in June, Kpler data showed.
Russian trading companies have also started paying visits to the port, Murad said, without naming them, to look at the facilities there.
Aramco Trading Co., an arm of Saudi Aramco that is expanding its business globally, has an office in Fujairah that opened in 2019.
Fujairah has risen rapidly in the last two decades to become the world’s third-largest bunkering port, after Singapore and Rotterdam.
Ship fuel sales at the Port of Fujairah climbed 11.45% on the month to reach the second highest on record in May, according to Fujairah Oil Industry Zone data published on its website.
Total bunker volumes climbed to 746,777 cu m, the most since October 2021’s record 782,060 cu m, data compiled by S&P Global showed.
However, Fujairah, one of seven members in the UAE federation, expects to attract increased crude trading and storage in the future on top of its current oil products business, which represents the majority of activity at the port now.
Abu Dhabi National Oil Co., the UAE’s biggest energy producer, is building underground caverns that will have capacity to hold 42 million barrels of crude.
When complete, it will boost Fujairah’s status as a regional trading center, as the caverns will be able to store three different grades of crude, providing ADNOC with more flexibility to export oil through the port.