STOCKS DATA: Fujairah fuel oil stocks hit three-month low

Quantum Commodity Intelligence - Fuel oil stocks in the bunkering hub of Fujairah slumped to a three month low after posting an 810,000-barrel draw in the week ending 5 July, according to data from FEDCom and S&P Global Platts.

Inventories of residual fuels totalled 11.05 million barrels, according to the data, a fall of 7% and the lowest level since mid-April.

The draw comes as fuel oil demand for electricity use in the region spikes seasonally due to a ramp up in air conditioning use.

Kuwait's Petroleum is tendering for up to six cargoes of fuel oil for delivery over the next three months – a move that likely means refinery runs at its Al-Zour refinery are lower than expected.

Yet while the stocks are relatively low, they are only around the average so far this year and the average of 2019, with marine fuel cracks broadly flatlining on the week amid volatile crude prices.

In other products, light end stocks showed a draw of 791,000 barrels, down a sizeable 11% on the week but representative of variable inventories.

Light end stocks are around the average so far this year, but almost a quarter below average inventories in 2019 – a dynamic that has helped gasoline cracks in the region hit their highest level in more than a year of above $9/b FOB Singapore, according to Quantum data.

Middle distillates stocks, however, saw the reverse pattern.

While, inventories fell 287,000 barrels, or 7%, they remain broadly in the line with stockpiles so far this year, but more than 60% higher than the average inventory level for 2019.

Distillate cracks have been in a mildly bearish trend since the start of June as persistent outbreaks of the delta variant of Covid-19 hit demand for jet fuel.