Singapore - Oil product inventories in the Singapore storage and trading hub fell to an eight-month low in the week ended July 17, official data showed, in one of the latest signs that suppliers are gearing up for rule changes to make marine fuel cleaner.
Singapore onshore stocks of petroleum products, which include gasoline, diesel, jet fuel and residual fuel oil, came in at 38.372 million barrels, down from 41.725 million barrels in the previous week and their lowest since the week ended Nov. 14 last year, data from Enterprise Singapore showed on Thursday.
“Several industry players are switching their tanks toward the different kinds of low-sulphur fuels rather than just high-sulphur fuel oil,” a source with a Singapore-based storage operator said when asked about shrinking oil product stocks.
The switching process will take time and involves clearing storage tanks occupied by high-sulphur fuel oils (HSFO) and their blending components, said the source, who declined to be identified because of company policy.
Under International Maritime Organization (IMO) rules that come into effect from 2020, ships will have to use fuel with a sulfur content of 0.5% or less, down from 3.5%, in one of the biggest fuel-spec changes to hit the global shipping and oil refining industries in decades. The decline in inventories was led by distillates, sinking to a more than nine-month low of 10,163 million barrels, an residual fuels that slipped to a six-month low of 18.539 million barrels, the data showed.