London, 14 June (Argus) — Oil products held in independent storage tanks in the Amsterdam-Rotterdam-Antwerp (ARA) trading hub climbed by just over 7pc week-on-week to reach 5.7mn t today, marking a two-month high.

The increase in total stocks was largely a result of a substantial gain in fuel oil inventories, which were up by nearly a third week-on-week. No tankers loaded the product from Rotterdam during the period, keeping northwest Europe oversupplied. But fuel oil exports are likely to rebound as shipping activity has picked up in northwest Europe, with tankers booked to Asia-Pacific and the Mideast Gulf. Two Singapore-bound very large crude carriers (VLCCs) have arrived in Rotterdam to start loading fuel oil later this month.

Diesel stocks rose slightly because of comparatively high imports, particularly from the Baltic Sea. The product also arrived from Poland and the Mideast Gulf, while some diesel was shipped form the ARA region to France, the UK and west Africa. Stocks are under pressure from firm demand, which is likely to tighten the market later this month.

Gasoline stocks increased by 5pc week-on-week. The European gasoline market remains oversupplied as an increase in US demand was offset by weak buying interest from west Africa and Asia-Pacific. Arbitrages on most long-haul export routes were largely unviable, putting pressure on gasoline prices in the ARA region. European gasoline output remained high, contributing to the increase in stocks. Meanwhile, the Mediterranean market remains tight, drawing product from the north.

Jet fuel stocks declined marginally during the past week despite rising exports from the Mideast Gulf, as tankers carrying jet fuel arrived into northwest European ports outside the ARA hub. The region is set to receive at least 290,000t of jet fuel from east of Suez during the week to 16 June, compared with 145,000t a week earlier.

Naphtha stocks fell by nearly 6pc, after having been buoyed the prior week by cargoes arriving from the US Gulf Coast. Demand for light virgin naphtha from European gasoline blenders remains weak and is largely covered by local supplies. Last week, tanker bookings emerging with Asia-Pacific discharge options reached 340,000t, the highest weekly total since late April. The four cargoes are due to load between 20-27 June.

Reporter: Thomas Warner