Bunker market participants in the UAE's Fujairah, the Middle East's prime marine fuels centre, have been assessing the future supply of very-low sulphur fuel oil (VLSFO) to the port, hoping to avoid a repeat of the severe supply crunch in June.
A disruption of Kuwaiti exports through the strait of Hormuz as well as news on the expected restart of a residual fluid catalytic cracker (RFCC) at Dangote's 650,000 b/d Lekki refinery in Nigeria, have increased concerns about short and mid-term bunker fuel availability.
Vortexa shows no VLSFO cargoes from Kuwait's 615,000 b/d al-Zour refinery left the Mideast Gulf in July. The last shipment was around 60,000t of VLSFO on board the Hydra, delivered to an unnamed terminal within the Gulf on 11 July. The larger share of the plant's fuel oil output is typically kept for domestic power generation in summer months, further reducing export availability.
A 100,000t shipment of low-sulphur straight-run residuals (LSSR) from Dangote in June had brought relief to the Fujairah market, after the acute supply crunch in June, when Fujairah delivered bunker premiums against cargo prices surged by 600pc to over $700/t. But the return of the Dangote RFCC, scheduled currently to be by the end of this month, could mean that the potential flow of feedstock material will soon not be available.
"Supplies are okay at the moment, but looking ahead at the second-half August, there are increasing concerns," a Fujairah bunker supplier said.
Vortexa shows just one vessel — the Abliani with 92,000t of low-sulphur residuals — departed the Black Sea port of Taman on 10 July, signalling Fujairah for 16 August arrival.
The vessel has been anchored near Port Said, Egypt, since 18 July, and it is not clear if it will proceed through the Bab el-Mandeb strait after a ban announced by Yemen's Houthi militia and subsequent attacks on two Saudi oil tankers.
The ban did not specify if it would focus only on Saudi vessels, but can impact all vessel traffic by increasing war risk insurance premiums.
Fuel oil, including high-sulphur grade, accounted for 37pc of the 1.6mn b/d of oil products that flowed through the Bab el-Mandeb strait in 2025. Vessels smaller than very-large crude carriers can still depart the ports on Saudi Arabia's Red Sea coast and journey through the Suez canal and then around the Cape of Good Hope, but such a diversion will come at a significantly higher cost.
