Oil product stockpiles at the port of Fujairah on the UAE’s east coast climbed to a two-week high, led by a 34% increase in gasoline and other light distillates.
The total inventory stood at 23.064 million barrels as of June 28, up 1.9% from a week earlier, according to June 30 data from the Fujairah Oil Industry Zone (FOIZ).
Heavy distillates stood at 11.861 million barrels, down 8.4% from a week earlier and the lowest in 11 weeks, according to the data provided exclusively to S&P Global Platts. Demand for heavy distillates used for power generation usually climbs at this time for year as businesses and homeowners crank up air-conditioners to beat the summer heat. The highest temperature in the UAE on June 29 was 46.7 degrees Celsius (116 F) in Abu Dhabi’s Bada Dafas, according to the UAE’s National Center of Meteorology.
The 34% jump in light distillates including gasoline and naphtha pushed inventories to 7.26 million barrels as of June 28, the most since March 29, after a 24% slump a week earlier and a record 43% surge the week before, according to the FOIZ data.
Gasoline imports into Fujairah have been just as volatile as the inventories. Some 1.09 million barrels of gasoline were headed for Fujairah in the week started June 21, more than double a week earlier, according to commodities data company Kpler. In the week before that, started June 7, they were at 1.79 million barrels, the most since early May.
The latest surge in light distillate inventories came amid lagging domestic output, particularly as the UAE’s state-owned Abu Dhabi National Oil Co. has been facing issues at its Ruwais facility. The residue fluid catalytic cracker at the 837,000 b/d plant has been shut since early June, following a technical issue, which then prompted the company to source gasoline cargoes from the regional market, Platts has reported.
Ruwais is now back online, market sources told Platts on June 30. The company declined to comment.
Of note, India is set to ship 47,300 b/d of gasoline to Fujairah for June, the most for any month since December 2020, according to Kpler. Indian refiners in June had raised spot export volumes due to domestic COVID-19 lockdowns, according to sources.
Against this backdrop of lagging domestic output, the UAE’s domestic demand remained firm, with driving activity in June staying around 250% above Jan. 13, 2000, levels before COVID-19 restrictions, Apple mobility data showed. By comparison, Saudi Arabia driving activity is little changed over the same period.
Middle distillates stocks, including jet fuel and diesel, stood at 3.943 million barrels as of June 28, down 7.4% from a week earlier and the lowest in two weeks, according to the FOIZ data.
Source: Platts