The Middle East fuel oil market is braced for a tightening third quarter as soaring power generation demand is set to curb Saudi Arabia's exports and Western sanctions could deprive the market of Iranian supplies.
But although tighter supplies should push Gulf fuel oil premiums higher and could lift the Singapore ship fuel bunkering market, fears of regional fuel oil shortage are unfounded, traders and analysts in the Middle East and in Asia say.
"Saudi Arabia is likely to remain a large net exporter of fuel oil, with much of this going to Asia," Riyadh-based HSBC analyst John Tottie said.
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