STOCKS DATA: Fuel oil and naphtha stocks drop again in ARA, jet fuel stocks rise

Quantum Commodity Intelligence - Fuel oil stocks in ARA fell 200,000 barrels last week and have now dipped below levels last seen around late May, sources said, citing data from Insights Global.

Stocks of bunker fuel, including high sulfur, 0.5% sulfur, ultra low sulfur, and diesel marine oils, were pegged around 1.23 million barrels on July 8, down from 1.44 million barrels on July 1.

Inventories had increased to 1.5 million barrels on June 24, up from around 1.2 million barrels in the second half of May but have drifted lower again over the last three weeks.

Curves for both high sulfur and marine fuel 0.5% sulfur FOB barges in ARA are in backwardation currently, Quantum data shows.

Backwardation between spot marine fuel 0.5% sulfur and the August swap was pegged at $4/mt on Thursday.

Meanwhile, naphtha stocks in ARA also dipped again last week, dropping to 215,000 barrels from 240,000 barrels a week earlier, and extending a decline since May 27 when they reached around 320,000 barrels.

Naphtha is also in wide backwardation, with the CIF cargo assessment in north Europe assessed $14.50/mt higher than August paper on Thursday.

Gasoline stocks in ARA also slipped lower again, dropping to 994,000 barrels on July 8, down 44,000 barrels from a week earlier, and leaving them at levels seen around June 24.

Nearby backwardation in the European gasoline market has blown wider in July, and cracks values versus Brent have gained after a slump in June.

Inventories of gasoline were above 1.1 million barrels throughout June.

Jet stocks climbed again to 1.140 million barrels on July 8, up from 1.085 million barrels a week earlier, and remain high. 

Stocks were last below 1 million barrels in mid May. 

Diesel and gasoil stocks in also slipped lower to 2.280 million barrels on July 8, down around 60,000 barrels from July 1, and down 185,000 barrels from June 24.

But distillate stocks have been building more than drawing down over the summer, and inventory levels on Thursday were still higher than seen in late May.

The curve for Low Sulfur Gasoil futures is flattish until October when it slides into backwardation.