Prompt supply remains tight in several key East of Suez bunker ports this week.
While Fujairah’s bunker market has mostly recovered from production issues two weeks ago, supply is now tighter as blending components have been held up in delayed tankers at the Suez Canal.
The cargo delay has reduced several of Fujairah’s suppliers’ ability to blend bunker fuel products. A bunker supplier has been without blendstocks and unable to quote prices for near-term deliveries. Another supplier was only able to load just over half the volume it had intended on a bunker barge because of the delays.
Two local refiners produce bunker fuels for supply in the port of Fujairah, where a total of 622,000 mt of bunker fuels was delivered in February. These two refiners also rely on imported blendstocks, but to a lesser extent than bunker suppliers without local production.
One of the refineries experienced significant production issues earlier this month, which crimped VLSFO availability and boosted Fujairah’s prices against other ports. Bunker fuel output from the refinery has now mostly recovered, according to local sources.
Availability of VLSFO has improved to bring Fujairah’s lead times down from 11 days two weeks ago, to around six days now. LSMGO stems also need to be booked around six days ahead to ensure delivery, while HSFO380 stems are particularly tight and require around 12 days of lead time in the UAE port.
Residual fuel oil inventory levels remain below the five-year average in Singapore. A considerable increase in exports from January and February has contributed to draw the port’s stocks this month. Suppliers in the bunkering hub had built stocks in the first three weeks of March, before a doubling in exports last week pulled the inventories down 2% to 22.31 million bbls, Enterprise Singapore data shows.