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Oil’s Worst Product Gives Refineries a Little Bit of Good News

  • Fuel oil is rallying strongly on refinery curbs, OPEC+ cuts
  • Surge comes despite major demand hit from new ship fuel rule
     
Photographer: Kyle Grillot/Bloomberg

As the coronavirus crushes global demand for gasoline, diesel and jet fuel, the world’s oil refineries are getting a helping hand from an unlikely source: fuel oil that contains so much sulfur that many ships are barred from using it.

As a leftover product from the refining process that’s used in power plants and sometimes on ships, so-called high-sulfur fuel oil has historically traded far below the price of the crude that it’s made from.