Fujairah Oil Industry Zone, in a bid to become a global oil trading and storage hub, has renewed a deal with S&P Global Platts to publish its commercial storage capacity data to the market every Wednesday.

S&P Global Platts, an independent provider of information, benchmark prices and analytics for the energy and commodities markets, first signed the Fujairah data deal in 2016. The new agreement is for three years.

Martin Fraenkel, president of S&P Global Platts, said that Fujairah hosts the Middle East’s largest commercial storage capacity for refined oil products. The published data includes an aggregate breakdown of fuel oil, middle distillates and light.

He said that Fujairah is accelerating its strides towards becoming a critical global node in the trading industry, at par with Rotterdam and Singapore, as it is the only UAE emirate on the Indian Ocean.

With the support of regional oil companies, he said that Fujairah is strategically placed to become a global hub due to its geographical location outside the Straits of Hormuz, while bridging the time gap between the East and the West.

“The integration of the data into our distribution capabilities and publishing the available data publicly reduces the market opacity to enable traders and investors to evaluate opportunities and risks,” he said.

The Fujairah Data Committee, known as FEDCom, is tasked with the responsibility to collect, verify and distribute inventory data to replicate the data sets that are provided in other trading centres such as Singapore and Rotterdam.

Sean Evers, managing partner at Gulf Intelligence, said that Fujairah’s commercial storage terminal has a storage capacity of 60 million barrels.

Moreover, he said that Abu Dhabi National Oil Company (Adnoc) has a dedicated storage terminal for exports at Fujairah.

As Fujairah is bracing for the next phase of development, Fraenkel said that Platts has started to assess a benchmark pricing index for Fujairah.

We certainly get feedback from our stakeholders from around the world. Our expectation is that the assessment will be increasingly important and move to benchmark status. The idea of publishing a benchmark pricing index for Fujairah has been contemplated for many years and is supported by a range of considerations that qualify the emirate to be a regional pricing centre for the petroleum products that are traded in the Gulf.”

He said the benchmark journey will take years but it will happen. The aspirations of the Fujairah government to evolve as a trading hub are significant and the infrastructure is significant.

When asked whether Fujairah can compete with developed centres like Rotterdam and Singapore, he said that Rotterdam and Singapore centres are massive hubs which have developed for many decades. So these processes take time to develop.