Total US fuel oil production is on track to decline this month after production fell last week by the largest amount since February 2022, data from the Energy Information Administration (EIA) show.
Changes in monthly US residual fuel oil from April to May (so far):
• Production down 19,000 b/d to 283,000 b/d
• Supply from 70,000 b/d up to 238,000 b/d
• Amounts from 21,000 b/d to 110,000 b/d
Gulf Coast and East Coast refineries led the decline, producing 15% and 9% less fuel oil so far this month, respectively, while West Coast and Midwest refineries they have produced 8% and 16% more.
Overall refinery utilization averaged 92% this month, a percentage point higher than April.
Much more fuel oil has been supplied out of storage to outlets such as bunker fuel blends and bulk terminals, to refinery coking units or to power generation. Supply, or implied demand, has increased from an average of 168,000 b/d in April to 238,000 b/d this month.
US fuel oil inventories have risen to 30 million bbls and have remained above this threshold for five consecutive months. East Coast and Midwest stocks are up 7%. West Coast shares, on the other hand, are down 3%.
Monthly average US fuel oil supply, imports and production since January 2021
US monthly average regional fuel oil stocks since January 2021
Changes in monthly US residual fuel oil average from April to May (so far):
• Total US inventories rose 997,000 bbl to 32.83 million bbl
• Gulf Coast storage 705,000 bbl to 20.16 million bbl
• East Coast stores 425,000 bbls to 6.60 million bbl
• West Coast inventories fell 158,000 bbl to 4.93 million bbl
US fuel oil imports rose 24% from 89,000 b/d in April to 110,000 b/d this month. According to cargo tracker Vortexa, about 64% of US fuel oil imports have arrived on the Gulf Coast, followed by 23% on the East Coast and the remaining 13% on the West Coast.
The Caribbean Netherlands has become the largest source of US fuel oil imports, while the previous largest source, Mexico, has fallen to fourth place, Vortexa data shows. Mexico had been the top source of U.S. fuel oil imports for a year earlier, while the Caribbean Netherlands had not been among the top five sources for at least the past year.
Fuel oil imports from the Caribbean Netherlands, which has large oil storage facilities near St Eustatius, have accounted for 32% of the US total so far in May. Mexico, which accounted for 41% in April, has been the source of just under 12% of US fuel imports this month.
Algeria remains the second largest source of US fuel oil imports with 27% of imports this month. Last month, Algeria represented a lower 17% of imports.
The EIA’s fuel oil export numbers lag two months behind import numbers and other data. According to data from Vortexa, U.S. fuel oil exports have fallen nearly 32% between April and this month.
India has maintained its position as the top importer of US fuel oil for the second consecutive month, accounting for nearly 28% of total US exports year-to-date. The Netherlands took second place with more than a quarter of exports, followed by the Bahamas with 23%.
Source: Motor
