Shippers trying to minimize time in the Middle East after oil tanker attacks pushed up insurance costs are scaling back purchases of marine fuels from the United Arab Emirates’ (UAE) Fujairah oil hub, trade sources said.
Instead, they are turning primarily to Singapore, the world’s top refueling hub, to buy marine fuels, also known as bunkers, with some diverting to smaller bunkering ports, including in India and Sri Lanka, the sources said.
A ton of 380-centistoke (cst) high-sulphur fuel oil (HSFO) in Fujairah has slipped from an average $5-$10 premium over Singapore in May to a discount of $30-$70 over the past two weeks, three sources said.
“$50 per ton below Singapore? Bargain, if you can cover the war risk premium,” said a Singapore-based marine fuels trader for a large commodities merchant.
All of the sources declined to be identified due to company policy.
Source: Reuters
