Marine fuel supplies at the Middle East's main bunkering and storage hub of Fujairah in the UAE will be tight in March as a result of low stocks and refinery maintenance.
Oversupply and weak bunker demand in February prompted fuel oil sellers to export cargoes to Asia. Supplies tightened after Fujairah exported 338,000 b/d of fuel oil in February, up from 300,000 b/d in January.
"Most barge slots for deliveries of very-low sulphur fuel oil (VLSFO) are booked from 16 March onwards, and there is not much cargo available from many suppliers" a Fujairah-based trader said.
One of the three refiners supplying the Fujairah market could be having partial maintenance, reducing availability, according to market participants. German energy firm Uniper and trading firm Vitol operate 67,000 b/d and 80,000 b/d refineries, respectively, that produce a combined 550,000 t/month of VLSFO. Fujairah-based Ecomar Energy Solutions has a 15,000 b/d modular refinery.
"We heard an oil major is bringing 100,000t of VLSFO, so hopefully it will ease the situation", a supplier said.
The Maran Cassiopeia arrived in the port this week loaded with 100,000t of low-sulphur residuals loaded from the Russian Black Sea port of Taman, according to Vortexa.
Supplies tightened as marine fuels demand rose on the month in March. Fujairah does not publish official statistics, but the total volume of VLSFO involved in deals reported to Argus in February fell to 125,000t, down by 25pc from 167,000t submitted by bunker market participants for assessment in January.
But demand for the high-sulphur 380cst grade (HS380cst) firmed as more scrubber-fitted vessels called the port, bringing the total amount of HS380cst in reported deals to over 44,000t from 24,000t in January. Argus receives deals from suppliers, traders and buyers on a daily basis and the volumes indicate a snapshot of general trends of the market.
Demand from the Qatari LNG fleet, which was expected to emerge following the UAE's decision in early January to lift the sea, land and air blockades of Qatar, has so far failed to materialise. Vessels of state-controlled Qatargas were major buyers of bunker fuels from Fujairah before the blockade in 2017.
"We have not seen a single Qatari-flagged vessel lift bunker here in Fujairah. Most will continue to bunker in Singapore, Qatar itself and in the Mediterranean", a bunker trader said.
By Elshan Aliyev
