Unwanted and cheap was the expectation many had for European high sulfur fuel oil after IMO 2020 took effect, but this scenario has failed to materialize. Instead, tight availability has dominated, with OPEC+ oil productions cuts boosting price support further.
Analysts are also warning that due to the OPEC+ production cuts dominated by Middle Eastern producers, fuel oil could become scarcer as these crudes typically yield a higher percentage of the product.
Sour support: The ongoing OPEC+ cuts have constrained the global supply of sour crude, as the largest production curtailments have come from sour crude producing countries such as Saudi Arabia, Kuwait and other Middle Eastern countries, and European refineries have seen lower monthly allocations as a result…
