Vessel discharging at Port of Fujairah. Image Credit: Port of Fujairah

• Fujairah bunker availability is showing signs of tightness
• Most suppliers offering on a firm enquiry basis only
• Some low on VLSFO and LSMGO stocks
• Fujairah's VLSFO price has doubled since the conflict began, in line with the global trend

Bunker availability in Fujairah is coming under pressure, with market sources reporting a tightness in supply due to back-to-back attacks impacting supply.

Ongoing security risks, operational challenges, and firm-only quoting are adding to market strain, while prices have surged and deliveries in some cases are being reduced or delayed, sources told Ship & Bunker on Tuesday, when asked about the current market conditions. 

Back-to-Back Fujairah Attacks Have Caused Difficulties

The supply strain comes against a backdrop of heightened regional tensions.

Fujairah has faced repeated drone attacks carried out by Iran in retaliation for US and Israeli military strikes on Iran in February. Since then, Iran has targeted vessels transiting the Strait of Hormuz as well as oil infrastructure across the region.

Fujairah, a key oil storage and the third-largest bunkering location, has been directly impacted.

Oil loading operations were reportedly suspended on Monday following a drone incident, while over the weekend, the terminal sustained damage after wreckage from an intercepted drone struck the facility.

Operational challenges are also emerging for vessels in the region.

GPS signal spoofing and jamming in offshore areas of Fujairah may disrupt vessel positioning and reduce navigational accuracy, ship agency Inchcape Shipping said in an update on Wednesday.

Two sources told Ship & Bunker of disruptions to bunker supply at berths in both Fujairah and Khor Fakkan on Tuesday, further complicating bunkering in the region.

However, the Fujairah Oil Tanker Terminal was operating as of Wednesday.

"As far as deliveries go, we are proceeding without issues," one firm told Ship & Bunker.

"Loadings however are a challenge, because there is damage at the terminals.

"It's all case-by-case.

"Volumes are significantly lower, because apart from the lack of inbound/outbound traffic which is missing, the ones that came to Fujairah from the Indian Ocean just for bunkers are reluctant due to the insurance premiums."

Fujairah Suppliers Quoting on Firm Enquiries Basis Only

“All suppliers are quoting on a firm enquiry basis, with the condition subject to availability,” a source said.

“Supply has definitely been affected both by availability and pricing,” a source said.

“And on top of that, there have been back‑to‑back instances of drone attacks in and around Fujairah, which have added another layer of disruption to bunker supply at berth.”

Some suppliers are unable to commit to delivering full stem sizes.

“It’s something like you place an order for 500 mt and they say only 200 mt is available,” the source said.

Some suppliers are running low on VLSFO and LSMGO grades and are unable to offer, another source told Ship & Bunker.

Ship & Bunker had reported earlier this month that some suppliers declared force majeure after Iran began attacks in the UAE.

Fujairah’s VLSFO price has more than doubled to $1,060/mt since the war broke out, according to price data from Ship & Bunker, in line with the global trend. 

Other Regional Ports Face Challenges

Bunker operations at the Omani port of Salalah remain disrupted following a drone attack that hit fuel storage tanks at the port last week.

“As per the latest updates, bunkering operations are not permitted at the moment, including in Salalah,” a local source claimed on Tuesday.

However, port operations have reportedly resumed at Port of Salalah on Wednesday, according to Inchcape Shipping Agency on Wednesday.

But a representative of the Fujairah Engineering Company (FECO) told Ship & Bunker it was seeing improved demand at Salalah and nearby ports.

"We are seeing an increased volume at the ports we supply, from Salalah to Sohar, because vessels are not subjected to such heavy insurance cost for calling these ports," the FECO representative said.

Meanwhile, bunkering at Saudi Arabia’s Eastern Province ports is available at the moment.

“Ports in Saudi Arabia’s Eastern Province, such as Dammam and Jubail, remain operational and can support bunkering subject to approvals,” the source adds.

Vessel movements in Bahrain have gradually resumed, but operations remain limited due to restricted availability of pilots.