Picture used for illustrative purpose.

The stockpiles of oil products at the Port of Fujairah outside of the Strait of Hormuz in the Arabian Gulf dropped to a two-month low, with some traders forced to buy marine bunkers after holding off because of escalating prices.

Total inventory was 21.183 million barrels on Feb. 8, down 9 per cent from a week earlier and the lowest since Nov. 30, according to Fujairah Oil Industry Zone, or FOIZ, data released Feb. 10 exclusively to S&P Global Platts. It was the biggest percentage weekly decline since Oct. 26.

Middle distillates led the way with a 15 percent decline over the week to Feb. 8, the highest drop in six months. The inventories came to 4.404 million barrels, a three-week low. The category includes gasoil, diesel and jet fuel.

Stockpiles of heavy distillates including fuel for power generation and marine bunkers stood at 9.786 million barrels as of Feb. 8, down 9 per cent from a week earlier and the lowest since Nov. 30.

Traders have held off buying marine bunkers because of rising Brent prices but have been forced to take shipments to keep ocean going vessels fueled up, according to Apurva Mali, founder of bunker supplier Masc Co. DMCC in Dubai. “There is a hope prices will go down after oil has steadied after the longest run of gains in the last two years.”

Fujairah-delivered marine 0.5 per cent bunker fuel was assessed at $494/mt on Feb. 9, up 7 per cent from $461/mt a week earlier, according to Platts data.

Light distillates including gasoline and naphtha stocks fell to 6.993 million barrels as of Feb. 8, down 5 per cent from a week earlier and the lowest in three weeks.

All 11 commercial terminal operators at Fujairah participate in the weekly inventory report, according to FOIZ. The storage volumes include activities such as blending and refining. FOIZ has provided the inventory data to Platts since January 2017.

Meanwhile, oil prices in international market fell on Thursday, paring recent gains, as renewed lockdowns and the emergence of new coronavirus variants weighed on the prospects for a swift demand recovery.

Brent crude fell 44 cents, or 0.7%, to $61.03 a barrel by 1321 GMT and US West Texas Intermediate crude lost 42 cents, or 0.7%, to $58.26.

The Brent benchmark had risen in the previous nine sessions, its longest sustained period of gains since January 2019. Wednesday had marked the eighth daily gain for US crude.

“The rally that has been on ‘til yesterday’s close may take some time to be repeated as finally the reality is being priced in, namely the slow pace of the oil demand recovery,” said Rystad Energy’s head of oil markets, Bjornar Tonhaugen.

World oil demand in 2021 will rebound more slowly than previously thought, producer group OPEC said on Thursday, adding to a series of downgrades as the impact of the pandemic lingers.

The International Energy Agency (IEA), meanwhile, said that global oil supply is still outstripping demand because of COVID-19 lockdowns and the spread of virus variants.