August 13, 2020 – Total oil products stocks held independently in the Amsterdam-Rotterdam-Antwerp (ARA) area rose on the week, a second consecutive week of gains, according to consultancy Insights Global.

The week on week stockbuild was driven by a rise in jet fuel and gasoline stocks to fresh all-time highs, while naphtha stocks also rose. Refining margins in northwest Europe have fallen back as markets have become oversupplied as a result of increasing refinery utilisation and persistently high stock levels.

Jet fuel inventories rose to their highest on record since at least January 2011 this week. Jet fuel was delivered to ARA from the UAE this week, while cargo outflows were recorded to the UK. Demand is slowly rising as air travel resumes — Insights Global recorded the first jet barge heading up the Rhine from ARA in several months this week — but proved insufficient to offset import levels this week. Jet values have come under pressure in northwest Europe in recent sessions in response to rising Covid-19 infections across Europe and fresh travel restrictions.

And gasoline stocks also hit an all-time high this week, on the week. Stock levels increased as a result of weakening export demand along key arbitrage routes to North America and west Africa, while inflows into the region were high as a result of oversupply on the continent prompting producers to ship excess volumes into storage tanks. Gasoline was delivered to ARA tanks from Finland, Sweden, the UK, France and the Mediterranean this week, while exports were recorded to Canada, the US, and west Africa, albeit in limited volumes.

Naphtha stocks gained on the week, their highest since June. Inventories probably increased as a result of waning demand for the product in Europe for both gasoline blending and also from the petrochemical sector. Naphtha was shipped into the ARA region from Algeria, Russia and Spain this week, and was removed from tank for a long-haul voyage to Brazil.

Fuel oil inventories fell to their lowest since March, marking a decrease of 10pc on the week. No fuel oil was imported into ARA storage from Russia — the leading exporter of the product — as the region is increasingly bypassed by direct shipments from Baltic Sea terminals to the US, where coking demand has provided an outlet for high-sulphur fuel oil (HSFO) this year following the IMO 2020 marine fuel sulphur cap. Fuel oil arrived to ARA storage from Italy, Poland and the UK, and left the region for the Mediterranean and west Africa.

And gasoil stocks dipped this week, as supply arrived from the US and exited for the UK. Barge activity was said to have been particularly thin over the past week, and the small stockdraw came as a result of minimal imports.

Reporter: Robert Harvey