Europe Distillates-Diesel margins end week higher

Northwest European diesel barge profit margins fell by about $1.81 to $16.66 a barrel on Friday, marking a 13% week-on-week rise as stocks fell in ARA despite higher October imports into Europe.

“Global diesel and jet crack spreads have rebounded nicely, with Singapore spreads gaining sharply on reduced Chinese exports,” said Sparta Commodities analyst Philip Jones-Lux.

“In October, global diesel deliveries to Europe have been adjusted upwards to a 22-month high of 7.77 million metric tons. Volumes from the Middle East and Asia have remained nearly unchanged, with an uptick in volumes from the U.S.,” LSEG analyst Rakesh Varma said earlier this week.

Gasoil stocks independently held in the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub fell by 5.5% in the week to Thursday to 2.01 million metric tons, data from Dutch consultancy Insights Global showed.

Jet fuel inventories, meanwhile, were down over 9% to 921,000 tons on limited imports from Asia, Insights Global’s Lars van Wageningen said.

U.S. distillate stockpiles, which include diesel and heating oil, fell 1 million barrels to 112.9 million barrels last week, versus expectations for a 1.6 million-barrel drop in a Reuters poll, Energy Information Administration data showed.

Russia’s exports of ultra low-sulphur diesel (ULSD) from the Baltic Sea port of Primorsk in November are set to reach 1.1 million metric tons, two traders said on Thursday.

That would be a 3.3% increase on a daily basis from 1.1 million tons scheduled for October as the month is one day shorter.

EU and UK diesel and gasoil imports reached about 1.28 million barrels per day in October, slightly above September levels, Kpler data showed.

Lyondell Basell Industries plans to permanently shut its 263,776 barrel-per-day Houston refinery in two stages, with the first in January and the second in February, Kim Foley, head of the company’s refining operations, said on Friday.

Russian oil product exports from the Black Sea port of Tuapse are set to rise to 807,000 metric tons in November, up 167.3% from the 312,000 tons scheduled for October, two traders said on Friday.

Iraq’s state-owned refiner SOMO is seeking to buy more high-sulphur diesel deliveries for December arrival, after earlier buying interest for one October cargo, three trade sources who saw the tender document said on Friday.
Source: Reuters (Reporting by Robert Harvey)