SINGAPORE: Northwest European gasoline refining margins slightly declined to $24.12 a barrel on Friday as oil prices rose on optimism that a US debt default might be avoided.

Oil prices rose 1% on Friday as US officials appeared close to striking a debt ceiling deal, and as the market weighed conflicting messages on supply from Russia and Saudi Arabia ahead of the next OPEC+ policy meeting.

US oil refiners are expected to have about 502,000 barrels per day (bpd) of capacity offline for the week ending May 26, increasing available refining capacity by 135,000 bpd, research company IIR Energy said on Friday.

US motorists are enjoying a so-called Goldilocks market, or one that is considered “just right,” for gasoline. Production is strong and prices are moderate. Product supplied, a proxy for demand, is up 2.5% year-on-year to 9.066 million barrels per day (bpd), according to the Energy Information Administration.

Global freight volumes show signs of having bottomed out in the first quarter, signalling the industrial cycle may be near its trough, which could provide some support to oil prices later in 2023.

Gasoline stocks held in independent storage in the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage area fell by more than 4% over the week as a result of rising exports to west Africa and the United States, Dutch consultancy Insights Global said.

US gasoline stocks fell last week by a larger-than-expected 2.1 million barrels to 216.3 million barrels, EIA data showed.