London, Sept. 7 (SANA) Marine fuel markets are heading toward a supply shortage in the third quarter as disrupted tanker traffic and refinery damage from wars in the Middle East and Eastern Europe prompt refiners to prioritize diesel, gasoline and jet fuel over fuel oil.
Reuters reported Monday, citing Energy Aspects, that the fuel oil supply deficit could reach 218,000 barrels per day in the third quarter. Rystad Energy expects supplies to remain tight after Middle East fuel oil exports fell 45% between March and August.
Inventories at major hubs, including Singapore, Amsterdam, Rotterdam, Antwerp and Fujairah, are about 30% below their three-year seasonal averages. In Singapore, very low sulfur fuel oil prices have surged 76% since the outbreak of the Middle East war, approaching $825 per metric ton.
Russia’s fuel oil exports fell to a record low of 591,000 barrels per day in August, while Middle East exports declined to about 447,000 barrels per day.
The supply squeeze could raise vessel operating costs and freight rates, particularly in Asia, as ships take longer routes to avoid areas of heightened tensions.
Meanwhile, Kpler data showed commodity vessel traffic through the Strait of Hormuz averaged about 10 ships per day over the past 10 days, the lowest level since May, following US and Iranian strikes targeting tankers.
Before the US-Israeli-Iranian war began in February, around 130 to 140 vessels crossed the strait daily under normal conditions.
N.J/MF
