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Fuel oil supply from Iran is expected to decline to below 1 million mt in October from the usual 1.2 million-1.4 million mt a month. ahead of the US sanctions in November. market sources said this week.
Market sources said buyers are gradually reducing their commitments to buy fuel oil from Iran in preparations of the sanctions.
Total export volume from Iran in October is expected to be around 900.000 mt. a fuel oil trader in the Middle East said.
Iran is considered as a supplier of high-quality cutter stocks for bunker fuel as it sells 280 CST straight-run high sulfur fuel oil.
About 500.000-600.000 mt month of the Iranian fuel oil exports goes into the Fujairah bunker market. industry sources said.
Meanwhile. `supply is not too tight [in Fujairah] at the moment.` a bunker trader in the Middle East said this week.
`No one can buy [Iranian fuel oil] from November.` a Singapore-based fuel oil trader said. `Traders don`t dare to buy… Companies are not taking risks.` another trader in Singapore said.
The uncertainty of Iranian fuel is one of the drivers of the current strength in the Singapore high sulfur fuel oil market. The possibility of 1 million mt a month of fuel oil cargoes disappearing from the market. especially cutter stocks. which to reduce viscosity and density. will tighten. market sources said.
Singapore 380 CST cash differential was assessed at $7.80 mt Thursday. the highest since June 17. 2015. when it was assessed at $9.98 mt. S&.P Global Platts data showed.
