The ARA’s independently held fuel oil stocks averaged 10% higher in May than across April, according to Insights Global data.

ARA fuel oil and gasoil stocks since January 2020

Changes in monthly average ARA stocks from April to May:

• Fuel oil stocks up 768,000 bbls to 8.55 million bbls
• Gasoil stocks up 435,000 bbls to 17.95 million bbls

The ARA’s fuel oil stocks increased for a third consecutive month and hit their highest level since June 2021. The fuel oil inventories grew amid signs of higher net fuel oil imports in May.

According to cargo tracker Vortexa, the ARA hub imported 224,000 b/d of fuel oil across May, down from an average of 250,000 b/d imports in April. The region’s fuel oil imports have ranged between 224,000-282,000 b/d since EU sanctions on refined Russian oil products came into force on 5 February.

The majority of fuel oil cargoes in May arrived from the UK (15%), France (12%), Brazil and the US (10% each). This is the first time Brazil has featured in the list of the ARA’s top five fuel oil import sources.

On the other hand, the ARA’s fuel oil exports plunged from 162,000 b/d in April, to 124,000 b/d in May – the lowest fuel oil exports since last September. This led to higher net imports and contributed to boost fuel oil stocks in May.

Fuel oil cargoes primarily departed to the UK (30%), Norway (12%) and Panama (9%) in May.

The ARA’s independent gasoil inventories - which include diesel and heating oil – averaged 2% higher in May than across April. Gasoil inventories averaged 17.95 million bbls in May, a massive 54% increase from stock levels a year ago.

The stock build has largely been supported by higher gasoil and diesel imports from Middle Eastern and Asian countries. Saudi Arabia and India have been the ARA’s biggest gasoil and diesel import sources since the EU ban on Russian imports.

Saudi Arabia accounted for 24% of the region's total imports in May, followed by India (20%) and the UAE (12%), Vortexa data shows.

By Nithin Chandran

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