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Home Latest Energy News By Tsvetana Paraskova - Nov 06, 2026, 6:30 AM CST Asia’s fuel oil refining margins and benchmark prices have slumped this week after the outcome of the U.S. midterms boosted hopes that there could be de-escalation in the Middle East allowing more oil products to move out of the Strait of Hormuz. The fuel oil market has also softened in recent weeks as more oil is exiting the Gulf and going to Asia’s demand centers. This week, the refining margin for high-sulfur fuel oil (HSFO) in Asia plunged to a discount of $2.29 per barrel on Thursday, compared to a premium of $5.34 a barrel on Monday, Reuters reports , citing LSEG data.
Supply of fuel oil from the Middle East to Asia has improved, also weighing on benchmarks and margins. With exports from Fujairah in the United Arab Emirates (UAE) outside the Perisan Gulf rising, the fuel oil prices are weakening. Fuel exports from the UAE en route to Singapore and Malaysia surged to an eighth-month high in October, at about 729,000 metric tons, according to Kpler data cited by Reuters.
However, high shipping costs are reducing European supply of fuel oil to Asia, according to traders. Meanwhile, the curve of the Dubai benchmark is showing signs that rising crude oil flows from the Middle East are exceeding demand for the first time since early July, when the three-week U.S.-Iran ceasefire allowed millions of barrels to leave unhindered the Strait of Hormuz. Physical flows have been gradually rising for the past two months as Gulf producers accelerated shuttle-shipping through Hormuz with ship-to-ship (STS) transfers in the Gulf of Oman, once tankers have cleared the chokepoint.
As a result, the November contract of the Dubai benchmark traded at the start of this week at a discount of about $2 per barrel to the December contract, traders and brokers told Bloomberg on Tuesday. This price curve, known as contango, is the first sign since July that current supply is abundant in the Middle East. By Tsvetana Paraskova for Oilprice.com More Top Reads From Oilprice.com Oil Prices Head for 12% Weekly Loss Despite Fresh Tanker Attacks ConocoPhillips Doubles Profit to $4 Billion, Raises Dividend India’s HPCL Struggles to Secure Oil Tankers as Hormuz Risks Persist Join the discussion | Back to homepage Tsvetana Paraskova What I Cover Tsvetana Paraskova is an energy and commodities journalist who has contributed to Oilprice.com for nearly a decade, covering global energy markets, commodities,...
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