Fujairah, which hosts the Middle East’s largest commercial storage capacity for refined oil products, has engaged S&P Global Platts in a 3-year agreement to distribute the Emirate’s weekly inventory data as part of its effort to position the Indian Ocean port-city as a global oil trading and storage hub.
After a successful one-year publishing agreement, the Fujairah Oil Industry Zone (FOIZ) agreed to extend its partnership with S&P Global Platts over the long-term to ensure the continued visibility to the market provided by regular and publically available data, which is a key ingredient of successful liquid trading centers around the world. The Fujairah Data Committee, known as FEDCom, is tasked with the responsibility to collect, verify and distribute inventory data to replicate the data sets that are provided in other global trading centers such as Singapore and Rotterdam.
“Publishing data reduces market opacity and enables traders and investors to see opportunities and risks more clearly, thus enabling them to develop cohesive risk-aware strategies and ultimately lock in greater profits,” His Highness Sheikh Dr. Rashed bin Hamad Al Sharqi, Deputy Chairman of FOIZ and Chairman of Fujairah Culture and Media Authority, said today at the signing of the agreement with the S&P Global Platts President, Martin Fraenkel. “S&P Global Platts partnership is another step forward in the right direction towards transforming Fujairah into a major global hub for the storage and trading of petroleum products,” His Highness announced this to the national and international media gathered for the occasion.
The UAE’s only Emirate on the Indian Ocean, Fujairah, is accelerating its strides towards becoming a critical node on the international energy markets map. This is most evident by the Port of Fujairah’s continued infrastructure investment and the expansion of its capacity to handle and process petroleum products, which now amounts to 100 million tons per year of crude oil and refined products.
The majority of oil storage private companies operating in Fujairah are currently involved in projects to increase storage capacity, including VTTI, owned by the Vitol Group. The Abu Dhabi National Oil Company (ADNOC) has constructed a 360-kilometre long oil transmission pipeline with a design throughput capacity of 1.8 million barrel-a-day oil pipeline that carries Abu Dhabi crude oil for export through three single point mooring systems located in the Fujairah anchorage area seamlessly accessible to international shipping routes.
Dave Ernsberger, Head of Energy Pricing, S&P Global Platts, said: “We are pleased to have extended our successful partnership with Fujairah by an additional three years to ensure that Fujairah Oil Industry Zone inventory data continues to gain traction amongst global audiences interested in understanding the flows of oil products in the region. The integration of this crucial data into our worldwide distribution capabilities allows us to support Fujairah in the next step in its development towards becoming a global trading hub”.
The idea of establishing a benchmark pricing index for the Emirate of Fujairah has been contemplated for many years and is supported by a range of considerations that qualify the Emirate to be a regional pricing center for the petroleum products that are traded in the Gulf. The main advantage of Fujairah is its strategic geographic location outside the Straits of Hormuz, while bridging the time gap between the East and the West.
The Fujairah Oil Industry Zone (FOIZ) and S&P Global Platts first signed a Memorandum of Understanding (MoU) in November 2016, when the independent data agency was awarded the mandate to distribute weekly inventory storage data and support the emirate in its outreach to those outside the Gulf region without an appreciation of Fujairah’s ever-growing capabilities. The published data includes an aggregate breakdown of fuel oil, middle distillates and light ends.
Fujairah sits at the heart of the new energy corridor that stretches from the East of the Suez Canal to Asia and has a vast array of capabilities, including pipelines, vast storage and several deep-water ports. Since September 2016, the Port is also home to the first very large crude carrier (VLCC) jetty on the Indian Ocean. The number of financial centers in the region has also grown, with the majority of banks, private and national oil companies and commodity trading houses engaging in local activities.
About S&P Global Platts
Founded in 1909, S&P Global Platts (spglobal.com) provides insights to help customers make better informed trading and business decisions with confidence. The company is the leading independent provider of information and benchmark prices for the commodities and energy markets. With over 1,000 people in more than 15 offices worldwide, customers in over 150 countries look to S&P Global Platts expertise in news, pricing and analytics to deliver greater transparency and efficiency to markets. S&P Global Platts coverage includes oil and gas, power, petrochemicals, metals, agriculture and shipping.
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