Galaxy Futures: Fuel oil cost-side volatility widens, watch out for position risks before the holiday

The Middle East situation is changing rapidly, increasing the risk of oil price fluctuations. The navigational issues in the Strait of Hormuz are recurring, and uncertainty is rising. The near-term supply of high-sulfur fuel oil remains in a tight state. Attacks on Russian refineries and ports are still ongoing. A supply gap in the Middle East is still expected in the short term. Later on, as high-sulfur fuel oil enters its peak season for power generation demand, keep an eye on the demand-side positives and how they affect the start-up timing. The near-term supply gap for low-sulfur fuel oil in the Middle East still provides support. Brazil’s supply continues to grow, and there is currently no driver for bunker fuel demand. (Galaxy Futures)