Full Breakdown
Global Ship-Fuel Shortage Looms as Wars Disrupt Refining
9/8/2026, 11:51:32 AM
Emerging Fuel-Oil Deficit in the Third Quarter of 2026
Refiners are projected to face a shortfall of 218,000 barrels per day (bpd) of fuel oil in the third quarter, according to Energy Aspects. The deficit marks the first sizable gap since the same period in 2025, when the shortfall was only 6,000 bpd. The shortage affects both marine bunkers and power-plant fuel supplies, raising the price of very-low-sulphur fuel oil (VLSFO) by 76 % to just under $825 per metric ton (about $130 per barrel) in Singapore as of September 1.
Background & Context
Two concurrent wars have reshaped global crude processing:
- The Iran-related conflict has disrupted tanker traffic through the Strait of Hormuz and the Bab el-Mandeb, limiting Gulf crude flows.
- The Ukraine-Russia war has led to repeated drone attacks on Russian refineries, cutting Russian fuel-oil exports to a record low 591,000 bpd in August, down from an average of over 860,000 bpd in 2025.
Refiners are responding by prioritising higher-margin products—diesel, gasoline and jet fuel—over fuel oil. Nigeria’s 650,000-bpd Dangote refinery has increased diesel, gasoline and jet-fuel exports while its fuel-oil shipments have fallen, according to Kpler data. Energy-aspects analyst Royston Huan notes a 400,000 bpd reduction in global ship-fuel sales since April, comparable to the total volume of China’s bunker market.
Data & Statistics
| Metric | Figure | Source |
|---|---|---|
| Projected Q3 fuel-oil deficit | 218,000 bpd | Energy Aspects |
| 2025 Q3 deficit (baseline) | 6,000 bpd | Energy Aspects |
| VLSFO price increase (since Iran war) | 76 % to <$825/mt> | ZeroNorth (as of Sept 1) |
| Russian fuel-oil exports, Aug 2026 | 591,000 bpd (record low) | Kpler |
| Middle-East fuel-oil exports, Mar-Aug 2026 | 447,000 bpd (-45 % YoY) | Kpler |
| Singapore, Amsterdam-Rotterdam-Antwerp, Fujairah inventories | ~30 % below three-year seasonal averages | Reuters |
| East-Coast U.S. distillate inventories (week to Aug 28) | Record low | Reuters |
| Amsterdam-Rotterdam-Antwerp gasoline stocks (Aug 27) | Lowest in ~5 years | Reuters |
Verbatim Quotes
- “There's really a shortage of products because we're missing 2 million barrels a day from Russia, and we're missing nearly 2 million barrels a day from the Middle East,” — Vitol CEO Russell Hardy
- “For perspective, this supply loss is about the same magnitude as all of China’s bunker sales volume,” — Royston Huan, energy aspects analyst
Conflicting Reports & Gaps
Public data on the Dangote refinery’s exact fuel-oil export volumes remain unavailable; the company has not disclosed monthly figures, leaving analysts uncertain whether the decline reflects deliberate internal upgrading, changes in crude supply, or purely margin-driven decisions. No alternative deficit estimates were reported, so the 218,000 bpd shortfall remains the sole quantitative projection.
What’s Next
The same outlook suggests that high diesel margins will continue to divert crude away from the bunker-fuel market, sustaining price pressure on VLSFO until the underlying geopolitical disruptions are resolved.
