Total product stocks at Fujairah rose 0.2% to 10.147m barrels in the week to Monday 13 July, a three-month high and a fourth straight weekly gain1. The composition went the other way. Middle distillates fell 9.7% to 1.115m barrels, a three-month low, while light distillates jumped to a five-week high of 1.77m and heavy distillates slipped to 7.262m, their first drop in six weeks.
Fujairah sits on The Gulf of Oman side of the strait, which makes it the natural swing supplier of diesel and jet into the Mediterranean when European cracks run bid. A hub building gasoline-range material while drawing the barrels Europe is actually short of has stopped playing that role.
Set the number against its neighbours. ARA gasoil stocks fell to a two-and-a-half-year low near 13.48m barrels as imports halved, and the US distillate deficit widened to 11% below the five-year average even on a build. Three regions, one direction of travel on middle distillates, and the only headline print that looks constructive is the one whose internals say otherwise. Anyone who modelled the East-West gasoil arbitrage off the Fujairah top line this week took the sign the wrong way round.
One caveat belongs on the record. This survey covers the week to 13 July, which closes before the Kuwait strike and the escalation that followed. The composition divergence it shows has not yet been tested against post-strike demand or against the freight and insurance loadings now sitting on any westbound cargo.
