Marine fuel providers are experiencing tighter supplies of higher-density, low-sulphur crude oil, commonly referred to as heavy sweet, for blending purposes. This scarcity arises due to competition from refiners who are vying for the same crude, exacerbated by disruptions in Middle East imports resulting from the ongoing Iran war, according to industry sources.
The diminished availability of fuel-blending components coincides with refiners scaling back production of low-sulphur fuel oil (LSFO) for marine use, driven by crude shortages. This situation is leading to increased spot premiums for residual fuel utilized in ship operations.
Crude varieties such as Dar Blend from South Sudan, along with Australia’s Vincent and Pyrenees, are typically exported to Singapore and Fujairah in the United Arab Emirates. Their low-sulphur content and beneficial properties facilitate easier blending to produce 0.5 percent-sulphur fuel oil, known as very low-sulphur fuel oil (VLSFO), essential for refueling vessels.
Since the onset of the Iran war on February 28, some of these crude supplies have been redirected to refineries to compensate for disrupted Middle East supply chains, as corroborated by numerous industry sources and ship-tracking information.
Data from Kpler reveal that China imported more than 300,000 metric tonnes (approximately 2.19 million barrels) of Dar Blend monthly during March and April, a significant increase compared to no imports in February.
June Goh, a senior analyst at Sparta Commodities, mentioned, “As refineries are running at lower intake due to shortages of medium sour crude from the Middle East, they will need to resort to heavier crude alternatives, including sweet barrels, to maintain production levels.”
LIMITED HEAVY SWEET CRUDE SUPPLY
The availability of heavy sweet crude has historically been low due to limited output from the few fields where it is extracted.
With the war now intensifying, the price of this crude has surged, complicating efforts to secure adequate supply for blending and producing VLSFO this month, as noted by a trader based in Singapore who is active in the market.
Emril Jamil, a senior analyst at LSEG, indicated, “The loss of medium sour crudes and refinery run cuts may redirect heavy sweet crudes towards refineries, resulting in a diminished supply of low-sulphur blendstock in the market.”
Furthermore, these refinery cutbacks will prompt refiners to prioritize the production of distillate fuels such as diesel and jet fuel over LSFO, further constraining supply for bunkering purposes. Although a recent influx of Brazilian imports has moderated spot VLSFO premiums from historic highs of nearly $140 per metric tonne on March 18, they remain elevated at over $17, compared to pre-war figures of $2.
The shortages in blendstocks may compel blenders to resort to unconventional oil sources, which fuel experts warn could potentially lead to quality issues harmful to ship engines.
Chris Turner, technical manager at Integr8 Fuels, stated, “With supply constrained by tensions in West Asia and disruptions around the Strait of Hormuz, the utilization of unconventional feedstocks is a predictable response. This is not a rare lapse in quality, but rather a technical consequence of market stress, a situation we have witnessed across numerous major disruptions over the past decade.”
Fuel testing agency VPS has advised vessels to seek clarification from suppliers about the blending components used, particularly regarding any alternative feedstocks.
Published on April 21, 2026
