LONDON: Gasoline refining margins in northwest Europe weakened on Monday due to rising supplies in the region on reduced export opportunities, traders said.
Exports out of Europe to the US East Coast were limited due to high freight costs and weak US demand, as were exports to West Africa.
"WAF gasoline is on hold due to spec change. It is a tricky time, so trading might be down due to that," a trader said.
Globally, the gasoline market was also under pressure. "Light ends are coming under the same pressure that has compressed diesel cracks worldwide this year.
The problem is too much refining capacity. Not only are more refineries making gasoline, fewer places need arbitrage supplies as a result," London-based consultancy Energy Aspects said in a report.
Refinery maintenance in eastern Canada and outages on the US East Coast could nevertheless offset some of the overhang in the Atlantic basin, it said.
Israel's Oil Refineries (ORL) said it would shut its hydrocracker for a few weeks to repair a pipe, a move that may cost up to $10 million. According to traders, the outage is expected to impact gasoline production more than diesel.
"It will probably impact the gasoline side more. And even then, product always seems to eventually come from somewhere," one diesel broker said.
GASOLINE:
No barges of benchmark Eurobob gasoline traded in the afternoon price assessment window as there were no bids or offers.
Some 3,000 tonnes traded ahead of the window at $932 a tonne fob ARA, down from $958 a tonne on Friday. NIC and Shell sold to Morgan Stanley and Trafigura.
The early trades came at premiums to the October swap of $45 and $47 a tonne, compared with Friday's premiums at $52. The October swap traded $884 a tonne fob ARA at end of trade.
Two barges of premium unleaded gasoline traded at $955 and $957 a tonne fob ARA.
At 1610 GMT, Eurobob's crack to dated Brent was down at about $12.35 a barrel from about $14.51 a barrel on Friday.
Brent crude oil futures were down 70 cents at $100.12 a barrel.
US RBOB gasoline futures for October were down 0.93 percent at $2.5594 a gallon. The prompt crack was at $15.20 a barrel, up from $14.80 a barrel.
Shell sold a cargo to Gunvor at $846 a tonne cif NWE for Sept. 18-22 loading, down from Friday's trades at $855.
The prompt naphtha crack was at about minus $4.66 a barrel, down from minus $3.32 a barrel, according to Reuters' calculations.
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