Asia is on track to import a record volume of Russian fuel oil this March, as shifting geopolitics and supply disruptions in the Middle East reshape global
energy flows. The surge follows a temporary easing of US sanctions, allowing stranded Russian cargoes to re-enter the market at a time of tightening supply. Shipping data from Kpler and LSEG indicates that more than 3 million tonnes (around 614,500 barrels per day) of Russian fuel oil are expected to arrive in Asia this month. The increase comes as the ongoing US -Israel-Iran conflict disrupts fuel shipments through the Strait of Hormuz and forces refinery shutdowns across parts of the Middle East. The additional Russian supply is helping to ease immediate concerns over fuel shortages, particularly in high-sulphur fuel oil (HSFO), which has been hit hardest by the disruption of heavy crude flows from the Gulf. Southeast Asia is emerging as the primary destination, with an estimated 1.7 to 1.9 million tonnes heading to hubs such as Singapore and Malaysia. Much of this fuel is expected to be used for marine bunkering. China is the second-largest buyer, likely importing between 1.2 and 1.5 million tonnes, with cargoes primarily feeding independent refineries in Shandong province as an alternative to constrained Middle Eastern crude. Analysts note that the blockade of the Strait of Hormuz has had a disproportionate impact on HSFO markets, given its reliance on medium and heavy-sour crude supplies from the region. A 30-day waiver issued by Washington on March 12 has further enabled Asian buyers to tap into discounted Russian fuel. While the influx has cooled prices slightly—spot premiums for 380-cst HSFO have eased from record highs above $76 per tonne to around $70—the market remains structurally tight. Backwardation has set in, with prompt prices exceeding future contracts, signaling ongoing supply stress. Experts caution that Russian volumes may offer only temporary relief. Continued refinery run cuts in the Middle East and Asia, coupled with restricted crude availability, could keep markets firm in the coming weeks. If disruptions in the Strait of Hormuz persist, analysts expect fuel markets to remain bullish, with supply-demand balances under sustained pressure.
