US fuel oil supply, or implied demand, has averaged 66% lower this month than in February and has dropped to its lowest level since October 2015, data from the Energy Information Administration (EIA) shows.
Changes in monthly US residual fuel oil from February to March (so far):
• Supply down 239,000 b/d to 122,000 b/d
• Production down 8,000 b/d to 250,000 b/d
• Imports down 107,000 b/d to 80,000 b/d
Much less fuel oil has been supplied out of storage to outlets like bunker fuel blenders and bulk terminals, to refinery coking units for upgrades to other higher-value products, or to power generation. Supply, or implied demand, has more than halved from 361,000 b/d across February to just 122,000 b/d so far this month.
Total US fuel oil stocks have still averaged 1% lower this month despite less fuel oil supplied out. East Coast stocks have declined by 11% on the month. While Gulf Coast and West Coast have gained by 1% and 4%, respectively. Gulf Coast stocks are at their bulkiest since June 2020.
US fuel oil production has declined by 3% on the month. East Coast and West Coast refiners have produced 18% and 12% less fuel oil this month, while Gulf Coast refiners have produced 5% more. Gulf Coast refiners have increased their fuel oil production for a fourth consecutive month.
Overall US refinery utilisation has averaged about 88% this month, up from 87% in February and 85% in January.
Changes in monthly average US residual fuel oil from February to March (so far):
• Total US stocks down 278,000 bbls to 30.86 million bbls
• Gulf Coast stocks up 179,000 bbls to 19.14 million bbls
• East Coast stocks down 688,000 bbls to 5.30 million bbls
• West Coast stocks up 215,000 bbls to 5.12 million bbls
The US fuel oil imports have plunged by a massive 57% this month and noted their lowest levels since October 2019. According to cargo tracker Vortexa, about 81% of US fuel oil imports have arrived on the Gulf Coast, followed by 16% on the East Coast and 3% on the East Coast.
Mexico has been the US’ biggest fuel oil import source since April, Vortexa data shows. Fuel oil imports from Mexico accounted for 30% of the US’ total in February. And this share has increased further coming into March, with about 39% of imports arriving from Mexico.
The Bahamas (10%) has emerged as the second biggest US fuel oil import source, followed by Iraq (9%), Malaysia (8%) and Belgium (6%).
The EIA’s fuel oil export figures lag two months behind figures for imports and other data. Going by Vortexa data, US fuel oil exports have declined for a third consecutive month. About 104,000 b/d of fuel oil has been exported from the US this month, down from 110,000 b/d in February and 126,000 b/d in January.
Nearly half of US fuel oil exports have departed for Asia, with Singapore (28%) and India (19%) as the top destinations, followed by the Caribbean Netherlands (14%), the Netherlands (12%) and Canada (9%).
Source: Engine Technologies (https://engine.online/news-single?postId=18457)