FUJAIRAH DATA: Oil product stocks drop after first jet fuel shipment this year
Oil product stockpiles at the Port of Fujairah on the UAE’s east coast dropped across the board, with middle distillates hitting a one-year low after the first jet fuel shipment this year.
Total inventory stood at 19.087 million barrels as of April 12, down 8.1% from a week earlier and the lowest in three weeks, according to Fujairah Oil Industry Zone data provided exclusively to S&P Global Platts on April 14.
Middle distillates stocks stood at 3.082 million barrels as of April 12, down 8% from a week earlier and the lowest since April 13, 2020. The category includes jet fuel, gasoil, diesel, marine bunker gasoil and kerosene.
Traders had at least 670,000 barrels of middle distillates set for export from Fujairah in the week started April 5, which included the first jet shipment this year, according to data intelligence firm Kpler. A shipment of 350,000 barrels of jet was headed for Seychelles and another 330,000 barrels of gasoil was destined for Yemen, the data showed.
The Singapore front-month jet fuel/kerosene derivative crack spread against Dubai crude swaps jumped to a six-week high at the Asian close April 12 on the back of improving demand indicators from the downstream aviation sector. The May jet fuel/kerosene swaps crack against Dubai – a measure of the product’s relative strength to crude – was assessed at $4.79/b on April 12, the most since March 3, Platts data showed. It has since dropped to $4.39 on April 13.
The increase in the cracking margin was attributed to an uptick in demand for aviation fuel in Asia, trade sources said. They also noted improving conditions in Europe with the resumption of international travel from the UK as of May 17 and improving air travel demand in the US, spurring buying interest for jet fuel barrels from Asia and the Middle East.
The uptick in the jet fuel/kerosene complex was also seen further along the derivative curve, with the Q3/Q4 quarterly jet fuel/kerosene spread assessed at minus 59 cents/b at the Asian close April 13, narrowing 12 cents/b from a month earlier. The trend indicates improving demand for jet fuel.
Stocks of light distillates, including gasoline and naphtha, stood at 6.011 million barrels as of April 12, a five-month low and down 3% from a week earlier. Light distillates exports for the week started April 5 were at least 680,000 barrels, with 330,000 barrels of gasoline headed for Pakistan, 170,000 barrels of gasoline going to Saudi Arabia and 180,000 barrels of naphtha being shipped to South Korea, the Kpler data showed.
Heavy distillates fuels used for power generation and marine bunkers fell 11% to 9.994 million barrels as of April 12 after a record 36% increase a week earlier.
There were 2.13 million barrels of fuel oil headed out of Fujairah in the week started April 5, the most in three weeks with some 1.36 million barrels signaling Singapore as a destination and another 420,000 barrels headed for Pakistan and 270,000 barrels headed for Mauritius, according to Kpler.