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  • Jan 9th, 2018
  • Comments Off on European gasoline margins lower after stock builds
Gasoline refining margins in northwest Europe ended the week 13 percent lower following large builds in US inventories while rising demand in the Middle East was set to support going forward. Prompt refining margins in the regions weakened further following a larger increase in US inventories of refined oil products last week. US gasoline stocks rose by 4.8 million barrels. Refineries in the US East Coast were running at reduced rates and tanker loading and discharging was hampered in several ports due to freezing cold temperatures.

But strong demand from the Middle East and West Africa has supported gasoline margins. Buying is expected to increase due to a large maintenance programme in March in the Middle East and Europe, traders said. Asia is set to receive up to 2.0 million tonnes of naphtha from the West this month, the highest amount in two years, putting pressure on light fuel margins that touched 22-month highs in November. High refinery runs and a lack of demand for naphtha as a gasoline blendstock over the colder, wetter winter months in Europe and the United States have resulted in unused naphtha, traders said.

Stocks in the ARA storage and refining hub were little changed in the week to Thursday, according to Dutch consultancy PJK International. Gunvor sold to Shell one barge of eurobob gasoline during the afternoon session at $615 a tonne fob ARA, compared with $618 and $619 a tonne on Thursday. Elsewhere, 8,000 tonnes traded at $616-$622.50 a tonne fob Amsterdam-Rotterdam, compared with $620-$623 a tonne. Gunvor and Glencore sold to Total, Shell, Trafigura and PetroIneos.

Gunvor sold to Total a barge of premium unleaded gasoline at $640 a tonne fob ARA, up sharply from $622 a tonne in the previous sessions. Two cargoes were offered at down to $617 a tonne fob Mediterranean but no deal concluded. The February swap stood at $620 a tonne at the close, down from $622.50 a tonne. The benchmark EBOB gasoline refining margin was largely flat at to $5.06 a barrel. Brent crude futures were down 60 cents at $67.47 a barrel by 1630 GMT.

Copyright Reuters, 2018


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