Fujairah oil products stocks jump as IMO 2020 takes effect

FUJAIRAH, Oil product stockpiles at the UAE's trading hub in Fujairah rose in the past week as IMO 2020-mandated marine fuel requirements took effect.

Stockpiles of heavy distillates and residues, including marine fuel, advanced 11 percent to 11.205 million barrels as of 6th January, the Fujairah Oil Industry Zone, FOIZ, reported Wednesday. Total inventories, including light, middle and heavy distillates, jumped about 12 percent to 20.735 million barrels -- a two-week high.

Fujairah is expanding shipping and storage facilities for refined products and crude as the International Maritime Organisation's 2020 rule took effect 1st January, requiring ships to use fuel that has no more than 0.5 percent sulphur, compared with 3.5 percent previously. Fujairah plans to conduct spot checks this year on ships taking bunker fuel to make sure they comply with the new rule, Captain Mousa Murad, the Port's general manager, told S and P Global Platts in December 2019.

Middle distillates fell 2.1 percent to 3.644 million barrels in the past week and light distillates rose almost 24 percent to 5.886 million barrels.

Heavy distillates include fuels used for power generation, while middle distillates cover jet fuel, kerosene, gasoil, diesel and marine bunker gasoil.

The light distillates category include gasoline, gasoline blending components like reformate and alkylate, naphtha, and other light petrochemical feedstocks and condensates that are stored in white product tanks and are of an API of 45 degrees and above.

Light distillates was the only category to show an inventory decline for 2019, tumbling 51 percent after more than doubling in 2018 and declining almost 15 percent in 2017. Middle distillates jumped 155 percent last year and heavy distillates climbed 62 percent. Total stocks rose seven percent for the year after a 2.3 percent gain in 2018 and a 12 percent drop in 2017.

The Fujairah Oil Industry Zone data started being reported in 2017.

Platts is the official publisher of the data.

Source: Emirates News Agency