US fuel oil output declines on Gulf Coast slowdown in May
Total US fuel oil production averaged 10% lower in May than across April amid lower production from Gulf Coast refiners, data from the Energy Information Administration (EIA) shows.
Monthly average US fuel oil supply, imports and production since January 2021
Changes in monthly US residual fuel oil from April to May:
- Production down 30,000 b/d to 273,000 b/d
- Supply up 27,000 b/d to 195,000 b/d
- Imports up 1,000 b/d to 90,000 b/d
Gulf Coast refiners' fuel oil production averaged 129,000 b/d, a massive drop from 165,000 b/d in April. East Coast refiners also produced 8% less fuel oil in May. On the other hand, West Coast refiners produced 12% more fuel oil.
Overall refinery utilisation averaged 92% in May, up from 91% in April.
Much more fuel oil was supplied out of storage in May. The fuel typically goes to outlets like bunker fuel blenders and bulk terminals, to refinery coking units or to power generation. Supply, or implied demand, grew from an average of 168,000 b/d across April, to 195,000 b/d in May.
Total US fuel oil stocks averaged 3% higher on month despite a rise in implied demand and less production. The stocks have remained above 30 million bbls for the fifth consecutive month. East Coast fuel oil stocks gained by 9% in May, while West Coast stocks were drawn by 2%.
Monthly average regional fuel oil stocks in the US since January 2021
Changes in monthly average US residual fuel oil from April to May:
- Total US stocks up 1.06 million bbls to 32.90 million bbls
- Gulf Coast stocks up 620,000 bbls to 20 million bbls
- East Coast stocks up 544,000 bbls to 6.72 million bbls
- West Coast stocks down 109,000 bbls to 4.98 million bbls
The US fuel oil imports inched 1% higher – up from 89,000 b/d in April to 90,000 b/d in May. According to cargo tracker Vortexa, about 79% of US fuel oil imports arrived on the Gulf Coast, followed by 12% on the East Coast and the remaining 10% on the West Coast.
Mexico continued to be the biggest US fuel oil import source in May, a position it has been holding for more than a year now. Fuel oil imports from Mexico accounted for 36% in May, a slight drop from 41% in April.
The Bahamas overtook Algeria to become the second-largest US fuel oil import source in May, accounting for 12% of the total imports. Algeria contributed 9% of US imports in May, down from 17% in April.
The EIA's fuel oil export figures lag two months behind figures for imports and other data. Going by Vortexa data, US fuel oil exports declined by 32% between April and May.
India held to its position as the top importer of US fuel oil for a second straight month, taking almost 23% of the total US exports in May. The Netherlands replaced Singapore to become the US' second biggest export destination, followed by the Bahamas with 18%.
By Debarati Bhattacharjee
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