Waterborne arrivals of fuel oil and dirty feedstocks into Philadelphia and Delaware on the US Atlantic coast (PADD 1) rose to their highest in over a year in November, Vortexa data indicate, with a similar momentum continuing into early December imports.
Increased flows into these ports are supported by a recent widening in the discount for products such as high sulphur fuel oil (HSFO) and VGO versus benchmark crude. Rising intake of these secondary feedstocks could also alleviate the impact of the broader decline in Philadelphia and Delaware crude imports after the closure of the 335,000 b/d PES refinery earlier this year.
Around 1.4mn bbl of dirty products — including fuel oil — arrived into the Philadelphia and Delaware area in November. Preliminary data show that imports could remain firm with around 850,000 bbl arriving in the first week of December. Meanwhile on crude, November imports into the two ports were seen at a multi-year low of around 220,000 b/d.
November fuel oil/dirty feedstocks cargo origins included Russia, Mexico, Spain and Egypt. The latter is noted as a more unusual source, with no fuel oil from here observed arriving into PADD 1 since at least 2016. December intake is expected to include more Russian and Mexican volumes.
HSFO prices have been falling in the run up to a global shift towards lower sulphur bunker fuels from 2020. Lower prices for high sulphur fuel oil (HSFO) have led to record US fuel oil imports from Russia, as covered in our recent notes.
The PADD 3 region is the largest importer of dirty products in the US, but arrivals were virtually flat between October and November. In contrast, rising imports into Philadelphia and Delaware — in conjunction with higher imports at Port Everglades, Florida — helped lift total PADD 1 arrivals by around 40,000 b/d over the same period.