Bunker fuel demand across key Middle Eastern ports declined in April as the war created uncertainty about ship movement and constrained fuel supply, although activity at some Omani ports recovered gradually, five market participants, including traders and suppliers, told Platts, part of S&P Global Energy, May 6.
Fujairah and Dubai bunkering demand was subdued throughout April as ship movement through the Strait of Hormuz slowed amid a bearish market outlook due to the war, two traders covering Middle East markets said May 6.
“We haven’t seen any demand in April at Fujairah and Jebel Ali ports. The vessels currently roaming in the Strait of Hormuz, as well as those heading to Qatar and Kuwait, are consuming bunker fuel, but apart from that, we are not observing much vessel movement, and inquiries are also not strong,” a Dubai-based trader said May 6.
Total bunkering and ship-to-ship calls at Fujairah and Jebel Ali increased to 470 in April from 140 calls in March, according to S&P Global Commodities at Sea(opens in a new tab) data.
“Initially, after the onset of the conflict, we thought the market was stabilizing. However, with Brent crude prices fluctuating, the market has become uncertain. All demand has shifted toward Africa, India(opens in a new tab) and Colombo(opens in a new tab) ports. Buyers in these regions initially panicked and consumed more bunker fuel at South Asia-Pacific ports(opens in a new tab),” the trader added.
“April is bad, no supplies and very less demand. Inquiries are one to two every day. I’m dry full April,” another Dubai-based trader said May 6.
Oil products inventories at Fujairah(opens in a new tab) in the UAE fell 6.9% to 6.501 million barrels in the week to May 4, reaching a record low for the fifth straight week and extending the drop since the Middle East war started, according to Fujairah Oil Industry Zone data published May 6.
Platts assessed the April average of marine fuel oil 0.5%S bunker delivered Fujairah at $/metric ton, down $/mt month over month.
Oman sees mixed trends
Salalah bunkering demand was weak in April, restricted by fuel shortages and allocation-based loading programs, a Salalah-based trader said May 6.
“Price factors affected the market a lot. We did about 1,000 metric tons in April, compared with 100 mt in March. Refiners were supplying cargoes on a quota basis, with bunker suppliers often receiving only a portion of the requested volumes. If we book three loads, we may only get one,” a Salalah supplier said May 6.
However, another Oman-based supplier said conditions improved in April, supported by stronger ship activity and better regional inquiries.
“Market conditions in Oman during April showed improvement, with demand increasing due to vessel activity and improved inquiries from regional operators.
Our bunker volumes rose to 2,986 mt in April from 2,160 mt in March, with some regional demand shifting toward Omani ports,” the Oman-based supplier said May 6.
Oman’s bunker sector saw consolidation, as O Bunkering and Marafi Services completed a merger to form a single integrated entity under the O Bunkering name.
“This merger between O Bunkering and Marafi represents a qualitative leap in the institutional maturity of Omani companies operating in the logistics sector,” Said Al Maawali, Oman’s minister of Transport, Communications and Information Technology, said in a statement received from the supplier May 6.
“A combined structure would improve operational flexibility and strengthen service reliability across Omani ports. The merger brings together complementary capabilities in the marine fuel supply sector, creating a more integrated and efficient operation,” the supplier added.
Iraq bunkering hit by transit uncertainty
In Iraq, bunkering operations remained under pressure during April amid uncertainty surrounding transit through the Strait of Hormuz.
“April proved to be a challenging month for bunker operations across Iraqi ports. We did about 7,000 mt in April, sharply lower than 15,000 mt in March. The decline was not due to lack of demand, but rather the inability of vessels to transit and plan voyages effectively,” Vinayak Kharmale, trader and operations lead at Sea Crown Marine Services DMCC, told Platts May 6.
“A common concern across the market remained — even if we take bunkers, where do we go next? Demand exists, but execution remains on hold until normal transit resumes.”
Platts assessed the April average of marine fuel 0.5%S delivered Basrah at $/mt, down $/mt month over month.
Source: Platts
