Author: Greta

Fuel oil Prompts Independent ARA Oil Product Stock Draw

April 23, 2020 – The total volume of oil products held independently in storage in the Amsterdam-Rotterdam-Antwerp (ARA) refining and trading hub fell during the past week, largely as a result of higher fuel oil flows to Singapore, according to consultancy Insights Global.

Overall stocks reached seven-month highs a week earlier, and inventories of gasoil and gasoline continued to increase during the week to yesterday amid low demand and steep contango in the forward curve for both products. The overall fall was mainly the result of the VLCC Bunga Kasturi Lima departing for Singapore carrying fuel oil across two separate bookings. Demand for bunker fuels from within the ARA area remained low, supporting the viability of the arbitrage route.

Stocks of naphtha and jet fuel also fell. Naphtha inventories fell on the week on lower imports. Tankers did arrive from France, Norway, Poland and Spain but carrying relatively small cargoes. The volume of naphtha heading up the Rhine into Germany on barges fell, and demand from gasoline blenders was very low. Naphtha is more economical as a blending component when it trades at a heavy discount to gasoline. But northwest European naphtha was assessed above the benchmark Eurobob oxy gasoline quote yesterday, making it uneconomical. Demand in northwest Europe came predominantly from the petrochemical sector, where high prices of rival feedstocks are probably supporting interest in naphtha.

Jet fuel stocks fell, pushed down by the departure of a tanker for the UK and at least one for use as floating storage in the North Sea. Part cargoes arrived from the Mideast Gulf and Asia-Pacific. Local demand was low, which freed up several barges in the ARA area that have typically been used to carry jet fuel to Amsterdam’s Schiphol airport. Some market participants have sought to take advantage of excess barge capacity in the region to use the vessels as floating storage, particularly in the gasoil market.

Gasoil inventories, including those of heating oil and diesel, rose. The Ice gasoil forward curve is in steep contango and consumer demand for heating or road fuels was broadly stable at a low level. Demand comes predominantly from market participants seeking to store cargoes. Ice May gasoil traded weaker than the month-ahead Ice June gasoil contract at lunchtime today, creating a clear incentive and encouraging the rare use of barges as floating storage.

Gasoline inventories also rose on low demand and steep contango in the forward curve. Demand in Europe has dropped by more than half in some major European markets since travel restrictions were imposed. A single tanker departed for key export market the US, but outflows to China rose as refinery run cuts east of Suez and the easing of lockdown measures supported gasoline demand. Tankers also left the ARA for use as floating storage off Amsterdam, as well as leaving for the Mediterranean and Singapore. Tankers arrived from France, Russia, Spain, Sweden, the UK and an LR tanker arrived from Finland.

Reporter: Thomas Warner

ARA Independent Oil Product Stocks at 7-Month Highs

April 16, 2020 – The total volume of oil products held independently in storage in the Amsterdam-Rotterdam-Antwerp (ARA) refining and trading hub rose during the past week to reach its highest level since September 2019, according to consultancy Insights Global.

Overall stocks increased, supported by rising inventories of all products except naphtha. Low demand across the oil product complex has tipped the various underlying forward curves into contango since the beginning of the Covid-19 pandemic in Europe, supporting storage economics.

Naphtha was the only product to buck the trend, with inventories falling on the week. Local petrochemical end-users consumed some local inventories, and inflows were low. Small cargoes did arrive from Russia and Spain, but in lesser volume than the prior week. Demand from gasoline blenders was virtually zero, owing to a growing supply overhang of the road fuel.

Gasoline inventories hit their highest since June 2018. Demand in Europe has dropped by more than half in major markets including Italy, France and Germany since travel restrictions came into force. And demand is also down heavily in key export market the US, where consumption was down last week by more than compared with the five-year average for the week. No tankers departed the ARA area for the US, but tankers did leave for China, the Mediterranean, the North Sea for orders, and Puerto Rico. Tankers arrived from Norway, Russia, Spain and the UK.

Gasoil inventories rose. Demand for ARA gasoil barges from Germany fell on the week, but diesel’s proportion of the gasoil volume heading into Germany rose. Market participants were heard to be bringing diesel inland to store in tanks previously used for heating oil storage, owing to a steeper contango in the former’s forward curve. Tankers arrived in the ARA area from Baltic and Russia, and departed for the UK and west Africa.

Some repurposing of storage tanks was also heard in the jet fuel market. Low demand from the aviation sector brought outright northwest European jet fuel prices to 18-year lows on 15 April, resulting in a steep contango and making it more economic to store jet fuel in tanks than to store diesel. A single jet fuel tanker arrived from South Korea while none departed.

Fuel oil stocks also rose, reaching their highest since June 2018. Tankers arrived from Russia, Latvia and the UK and departed for Malaysia. Northwest European fuel oil cargoes typically depart the region for Singapore rather than Malaysia, so it may be that the tanker will be used as floating storage offshore Malaysia but close to Asia’s key inventory hub of Singapore.

Reporter: Thomas Warner

ARA Oil Product Stocks Reach Seven-Week Highs

2 April, 2020 (Argus) – The total volume of oil products held independently in storage in the Amsterdam-Rotterdam-Antwerp (ARA) refining and trading hub rose during the past week, according to the latest data from consultancy Insights Global.

Overall stocks increased on the week, supported by sharp rises in jet fuel and naphtha inventories. Stocks of gasoline also rose amid poor demand, while gasoil and fuel oil inventories both fell slightly on the week.

Naphtha inventories rose on the week to reach their highest since Argus began collecting the relevant data in January 2011. The rise in stocks was the result of very low demand from gasoline blenders and a week on week fall in naphtha barge flows to petrochemical end-users along the river Rhine. Tankers arrived in the area from Italy, Norway, Russia and the UK but none departed. Naphtha is so oversupplied in Europe that more than 1mn t has already been booked to leave the continent for Asia-Pacific during April.

The lack of naphtha demand from gasoline blenders was the result of a global lengthening of gasoline supply. Road fuel demand has fallen everywhere that measures to slow down the spread of the coronavirus pandemic have been implemented. Gasoline demand in northwest Europe and in key export region North America was low during the reporting period, and no tankers departed for the US. Tankers left the ARA area for the Mediterranean, Mexico and west Africa, and arrived from France, Spain, Sweden and the UK.

Weak demand caused by widespread flight cancellations pushed jet fuel stocks to 11-week highs in the week to today. Cargoes originally destined for northwest Europe continued to be diverted elsewhere, although one cargo did arrive from South Korea. The contango in the forward curve reached its steepest since 1993 during the reporting period, and a rise in inflows is likely with at least one more South Korean cargo currently discharging.

Gasoil demand in northwest Europe has been strong in comparison with other products, supported by inland buyers filling up their storage tanks while outright prices are under such heavy pressure. But the effect continued to taper off during the past week as inland tanks filled up, and the volume of diesel departing the ARA area for inland discharge fell heavily on the week. Gasoil inventories fell despite the drop in barge flows amid lower imports. Tankers arrived from Russia and departed for the UK. Retail sales are under heavy pressure owing to the reduction in motor vehicle use.

Fuel oil stocks in ARA fell, amid viable arbitrage economics to Singapore. Demand for bunkering fuels was low but so were imports, which arrived from the Baltics, Norway, Russia and Sweden. Tankers departed for the Mideast Gulf, Denmark, the Mediterranean and Singapore.

Reporter: Thomas Warner

ARA Oil Product Stocks Reach Five-Week Highs

26 March, 2020 (Argus) – The total volume of oil products held independently in storage in the Amsterdam-Rotterdam-Antwerp (ARA) refining and trading hub have risen during the past week, according to the latest data from consultancy Insights Global.

Overall stocks increased on the week, with inventories of most products rising as a result of falling economic activity around the continent driven by the coronavirus pandemic. All surveyed product groups except jet fuel recorded week-on-week increases.

Weak demand caused by widespread flight cancellations had pushed jet fuel stocks to five-week highs in the week to 19 March. But demand is now so low that cargoes originally destined for northwest Europe are diverting elsewhere, and regional production of jet fuel is falling. As a result, stocks have fallen during the past week despite minimal demand from regional airports.

Independent stocks of all other oil products in ARA have risen, supported by a contango market structure — where prompt prices are at discounts to forward values.

Gasoil demand has been strong in comparison to other products, supported by inland buyers filling up their storage tanks while outright prices are under such heavy pressure. But the effect began to taper off during the past week as inland tanks filled up, and the volume of diesel departing the ARA area for inland discharge fell. Gasoil inventories consequently rose on the week, also supported by incoming tankers from the Baltics, Russia and the UK. Tankers departed ARA with gasoil cargoes for the Mediterranean and west Africa.

Gasoline inventories rose amid plummeting demand around the continent. Firmer demand from the US had supported arbitrage flows from northwest Europe to the US Gulf coast in recent weeks, but the increasing impact of coronavirus across the Atlantic helped close the westbound arbitrage route during the past week. With few viable arbitrage outlets and very low local demand, storage tanks remained the most attractive option for gasoline. Tankers arrived in ARA with gasoline from the Baltics, France, Norway, Russia, Sweden and the UK in the last week. And tankers departed for the Mideast Gulf, Canada, west Africa and the US — albeit in lower volumes.

Naphtha stocks in ARA increased on the week to reach fresh 19-month highs, with demand for the product as a gasoline blending component virtually non-existent over the last week. But low outright prices have made naphtha more competitive as a petrochemical feedstock, supporting barge flows from the ARA area to inland petrochemical complexes. Tankers carrying naphtha arrived in ARA from Algeria, France, Russia, Spain and the UK. And a single tanker departed, most likely carrying a heavy naphtha cargo to the arroch refinery in Sardinia.

Fuel oil stocks in ARA were broadly unchanged on the week, rising slightly. Demand for bunkering fuels was low but so were imports. Tankers carrying fuel oil arrived from Norway, Russia, Sweden and the UK, and departed for west Africa and the Mediterranean.

Reporter: Thomas Warner

ARA Oil Product Stocks Rise on Low Consumption

19 March , 2020 (Argus) – The total volume of oil products held independently in storage in the Amsterdam-Rotterdam-Antwerp (ARA) area rose during the past week, according to the latest data from consultancy Insights Global.

Overall oil product stocks increased on the week, with inventories of most products rising as a result of falling economic activity around the continent driven by the coronavirus pandemic. Jet, naphtha and fuel oil inventories all rose on the week. But gasoil inventories fell owing to strong demand from inland buyers, and gasoline stocks dropped on rising transatlantic exports.

Naphtha stocks increased to reach their highest level since August 2018, with demand for the product as a gasoline blending component virtually non-existent over the last week. Naphtha reached a rare premium to gasoline, making gasoline production uneconomical.

Plummeting gasoline demand in northwest European brought refining margins earlier this week to their lowest level since Argus records began. The low European prices supported transatlantic arbitrage economics, and gasoline tankers departed ARA for Mexico, Puerto Rico and the US, as well as for west Africa, the Mediterranean and Brazil.

Gasoil inventories fell heavily over the past week, as market participants in the European hinterland took the opportunity to refill their storage tanks. Contango in the gasoil forward curve also supported restocking. Barge flows up the Rhine into Switzerland, Germany and France all rose as a result. And gasoil cargoes departed the ARA area for Argentina, France and Ireland.

Jet fuel inventories in northwest Europe rose to reach five-week highs, with demand from airlines falling further with each passing day. No jet cargoes arrived or departed, suggesting that local production is swelling inventories in the absence of demand from nearby airports.

Fuel oil stocks rose over the past week amid an anticipated slowdown in demand for bunker fuels. Tankers carrying fuel oil arrived from France, Poland, Russia and the UK and departed for the Mediterranean and west Africa.

Reporter: Thomas Warner

ARA Oil Product Stocks Fall

13 March, 2020 (Argus) – The total volume of oil products held independently in storage in the Amsterdam-Rotterdam-Antwerp (ARA) area fell during the week to 12 March, according to the latest data from consultancy Insights Global.

Overall oil products stocks fell by on the week. The drop came as a sharp rise in fuel oil stocks was offset by falls in middle distillate and gasoline inventories. The storage market and inventory levels began to show the first signs of being affected by recent oil product price volatility and coronavirus fears.

Independently-held fuel oil stocks in ARA rose on the week according to Insights Global, reaching their highest since September 2019 on falling demand from the bunkering sector. Falling economic activity is weighing on bunker fuel prices, with the fuel used to power the world’s cargo ships and oil tankers. Prices in the world’s largest bunkering hub Singapore fell to [multi-year lows]on 10 March on lower underlying crude prices and fears over an economic slowdown.

Jet fuel inventories in northwest Europe reached their lowest since September 2014 in contrast, falling on the week. Demand for flights has [fallen precipitously]since the coronavirus outbreak, causing some market participants to speculate that cargoes arriving in Europe may be blended into the diesel pool. But enquiries for jet fuel storage tanks appeared to rise sharply, as low prompt demand brings the market structure into contango.

There was a similar increase in enquiries for gasoil storage, with the expiry of the Ice March gasoil today leaving the forward curve in contango through to the summer. But actual stored volumes fell by nearly 11pc on the week, amid firm demand from France and from along the river Rhine. Tankers departed the ARA for Le Havre and the UK, and arrived from Russia and the Baltics.

Gasoline inventories fell amid a rise in transatlantic outflows. Bookings on the route from northwest Europe to north America have been in recent weeks but many loadings were affected by bottlenecks, especially around Amsterdam. The backlog cleared during the week to yesterday, although some unloading delays were heard to be affecting barges carrying gasoline blending components. Demand from across the Atlantic was also supported by the switch to summer grade gasoline in the US, which typically bolsters exports from Europe. Tankers arrived in the ARA from Finland, France, Russia and the UK.

Naphtha stocks rose, supported by weak demand from users along the Rhine. At least one petrochemical complex in northwest Germany was preparing for a maintenance turnaround, reducing overall demand in the area. And more competitive prices of rival feedstocks also weighed on interest from those end-users with flexible feedstock slates. Tankers arrived from Algeria, Norway, Russia and the UK, while none departed.

Reporter: Thomas Warner

ARA Oil Product Stocks Edge Lower

5 March, 2020 (Argus) – The total volume of oil products held independently in storage in the Amsterdam-Rotterdam-Antwerp (ARA) area edged lower during the week to 4 March, according to the latest data from consultancy Insights Global.

Overall oil products stocks fell on the week. The small drop came as a sharp draw in fuel oil stocks was largely balanced out by rises in inventories of all other products.

Independently-held fuel oil stocks in ARA fell on the week according to Insights Global, reaching their lowest since December. Fuel oil tankers entered ARA storage from Russia — the world’s principal exporter of high-sulphur fuel oil — the Baltic states, the UK and the US. Production of fuel oil is increasing in Europe, which combined with a sharp drop in demand following the coronavirus outbreak, has pressured prices lower. EU-16 output was at its highest since April 2019 in January. Fuel oil was taken out of ARA storage for deliveries to destinations east of Suez, including the Mideast Gulf and Singapore, but it was unclear which grades of fuel oil were being exported.

Gasoil stocks rose on the week, ticking up slightly from last week’s one-year low. Gasoil was imported into ARA storage from Russia principally, after loadings from the Baltic Sea port of Primorsk were scheduled at five-year highs for the second consecutive month in February. Gasoil departed ARA storage for France — on sea-going vessels and barges up the Rhine — the UK and west Africa. Sharply lower diesel prices could have attracted buyers back to the market in northwest Europe.

Gasoline inventories rose on the week, reaching their firmest since mid-February. Gasoline was exported to Canada and the US this week, and to west Africa. Westbound exports probably rose amid favourable economics for transatlantic shipments, with Nymex Rbob trading above Eurobob gasoline in the week to 28 February. Gasoline entered ARA tanks from France, Norway, and the UK.

A gain in ARA naphtha inventories was registered. Naphtha arrived from Norway, Russia and the UK. Another naphtha cargo was exported from ARA storage to Italy. The Nord Gardenia departed Rotterdam for the Sarroch refinery in Sardinia. The refinery is undergoing maintenance on some units used in gasoline production. The Nord Gardenia‘s cargo is probably heavy naphtha for using as a gasoline blending component. The light naphtha that comprises the bulk of European trading typically flows in the opposite direction, making the flow relatively unusual.

The LR2 tanker Lyric Camellia delivered jet fuel to ARA in the week to 4 March, having loaded its cargo back in February from Tarragona, Spain. That would be the first Tarragona jet fuel loading in at least four years, according to oil analytics firm Vortexa. The fixture is probably a result of more competitive freight rates in the region and discounts of Mediterranean jet fuel to those in northwest Europe, opening an arbitrage route. Jet stocks in ARA rose on the week following the import from Spain and no exports, as demand remains poor in the region given a slew of flight cancellations in Europe.

Reporter: Robert Harvey

ARA Oil Products Stock Levels Fall to Ten-Week Lows

27 February, 2020 (Argus) — The total volume of oil products held independently in storage in the Amsterdam-Rotterdam-Antwerp (ARA) area fell during the week to yesterday, according to the latest data from consultancy Insights Global.

ARA stocks fell in the week to 26 February, down from a week earlier to their lowest since the week to 19 December. The fall resulted from draws on all surveyed products bar fuel oil.

Gasoil inventories fell in the week, the lowest since 17 January 2019. Demand for middle distillates along the river Rhine was reasonably firm, but an uptick in outflows was the primary reason for the stock draw. Tankers left the ARA area for Germany, Norway, the UK, west Africa and France. Widespread industrial action in France has prompted some diesel cargoes to leave the ARA for western France in recent weeks. But the volume rose further this week with an Aframax tanker carrying diesel departing for the Mediterranean port of Lavera. Tankers arrived in the ARA area from Russia, the Baltics and the US.

Gasoline inventories also fell — broadly in line with the level recorded at the same time last year. Outflows to west Africa rose on the week, and tankers also departed for the Mediterranean and Puerto Rico. Several seagoing cargoes remain on the jetty in the ARA as a result of delays to gasoline blending activity in the area. Viable arbitrage economics on the route from northwest Europe to the US Atlantic coast suggest that some of these cargoes will head west across the Atlantic. Tankers arrived from Finland, Russia and the UK.

Naphtha stocks in the ARA fell, falling back after jumping the previous week. Demand from petrochemical end-users along the river Rhine was lower on the week, but with relatively little naphtha arriving in the region, overall stocks were lower. Tankers did arrive from France, Poland and the UK, and the Harald Maersk departed the ARA for the Mediterranean carrying a heavy naphtha cargo.

Jet kerosine inventories dropped on the week to reach fresh 5.5 year lows. End-users are choosing to run down their private inventories rather than buy in a time of falling outright prices and uncertainty over potential aviation restrictions related to the coronavirus outbreak. No tankers arrived in the ARA area and at least one departed for the UK. Fuel oil inventories rose. Tankers arrived from Poland, Russia and the US and departed for the Mediterranean.

Reporter: Thomas Warner

ARA Oil Products Stock Levels Fall

13 February, 2020 (Argus) — The total volume of oil products held independently in storage in the Amsterdam-Rotterdam-Antwerp (ARA) area fell by around 1pc during the week to yesterday, according to the latest data from consultancy Insights Global.

ARA stocks fell in the week to 12 February, down from a week earlier. The small fall resulted from draws on gasoil, naphtha and jet fuel inventories.

Gasoil inventories fell in the week to 12 February, partly as a result of firm barge flows up the river Rhine but also because of demand for middle distillate cargoes in western France that drew in tankers from the ARA area. Refining in the country has been impacted by industrial action in the country since December, prompting a rise in barge flows to Strasbourg and unusual tanker bookings from the ARA hub to west coast destinations. There are currently [no loading restrictions] affecting barges along the river Rhine, a factor that further supported outflows from the ARA area. Cargoes departed for the UK as well as France, and arrived from Russia, Poland and the US.

Naphtha stocks in the ARA fell, the lowest level recorded since October. No naphtha cargoes departed the hub, while cargoes entered from Poland and the UK. Naphtha demand from petrochemical end-users in the ARA area and along the Rhine was steady at the firm levels recorded in recent week, and low naphtha supply in the key Mediterranean supply source has limited volumes available to northwest European buyers.

Jet kerosine inventories dropped on the week to their lowest since March 2015 amid tight supply around the continent. Refinery outages in the Mediterranean and low imports have combined to reduce the volume of available supply in northwest Europe. No tankers arrived in the ARA area and at least one tanker departed for the UK.

Gasoline stocks rose, amid persistently low exports to key arbitrage region the US. High inventories in the US Atlantic and Gulf coasts made the transatlantic arbitrage route from northwest Europe unviable during the opening five weeks of 2020, but a single tanker did depart the ARA area for the US during the week to yesterday and the route appears viable on paper. A tanker also departed for Argentina, probably carrying summer-grade gasoline, as well as to the Mideast Gulf, the Caribbean and west Africa. Tankers arrived from Norway, Spain and the UK.

Fuel oil inventories were broadly unchanged on the week. The volume arriving from Russian fell on the week, while tankers arrived from the Baltics and the UK. Tankers departed for west Africa but not for Singapore.

Reporter: Thomas Warner

ARA Oil Products Stock Levels Rise

6 February, 2020 (Argus) — The total volume of oil products held independently in storage in the Amsterdam-Rotterdam-Antwerp (ARA) area rose during the week to yesterday, according to the latest data from consultancy Insights Global.

Overall ARA stocks reached a small rise the week to 6 February. The small rise was driven by gains in gasoline and fuel oil inventories, which both recorded double-digit increases.

Fuel oil inventories rose during the week. Inflows into ARA came from France, Poland, Russia and the UK. The cargo from Poland was IMO-compliant low sulphur fuel oil, and the cargoes from Russia arrived in Aframax tankers. Russia typically exports high-sulphur fuel oil, demand for which has been curbed by the IMO 2020 global marine fuel sulphur cap. Fuel oil tankers departed ARA for the Mediterranean area this week, which could result in onward shipments east of Suez.

Gasoline stocks rose, amid low exports. The arbitrage route to the US remained closed throughout the reporting period, owing to high inventories across the Atlantic. Tankers did depart for the Caribbean and west Africa, and to the Mideast Gulf. Some mild barge congestion was heard around the Amsterdam area, causing some loading and discharge delays. Tankers arrived from France, Spain and Sweden.

Stocks of all other surveyed products fell. Gasoil inventories fell in the week to 6 February, largely as a result of a week on week rise in barge flows up the river Rhine. The increase in the volume heading inland was prompted by the lifting of loading restrictions that had been in place because of low water levels. The incoming volume was low amid weak demand in northwest Europe, where unseasonally high temperatures continue to weigh on heating oil demand. Tankers arrived from the Baltics and Russia, and departed for France and the Mediterranean.

Naphtha stocks in the ARA fell, according to Insights Global. No naphtha cargoes departed the trading hub, while cargoes entered from Norway and Russia. Naphtha demand has strengthened from the petrochemical sector and barge flows to inland destinations were higher on the week. And independently-held inventories of jet kerosine fell on the week. No jet cargoes were delivered to the area, and tankers departed for the UK.

Reporter: Thomas Warner