The shortage persists despite an increase in crude oil exports through the Strait of Hormuz, which Gallagher described as a failed 'silver bullet.' Refiners are currently prioritizing the production of diesel and other high-margin products to capitalize on exceptionally strong refining margins rather than increasing the output of high-sulfur fuel oil used by ships.
Tuesday, October 20, 2026
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Hormuz Crude Surge Fails to Halt 1M Ton Russia Fuel Oil Cut
Commodities5 days ago
Vitol reports that regional instability in the Persian Gulf has slashed monthly output of shipping fuel by 800,000 barrels, including losses from Iran. Additional disruptions from Ukrainian drone strikes on Russian refineries have cut another 1 million tons per month from the global market, tightening supplies and driving prices higher. Vitol Asia head Kieran Gallagher detailed these losses at the Sibcon conference in Singapore this week.
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