Gasoline refining margins in north-west Europe softened slightly on Tuesday but held near to a six-month highs on an open arbitrage to the United States and heavy refinery maintenance in Asia. Arbitrage to the United States was open enabling Europe to draw down the gasoline in tanks and on vessels outside of ports, traders said.
The US East Coast gasoline market looks set to begin the summer driving season with fewer barrels in storage than last year, as refiners have been profiting by producing winter grade gasoline longer than usual, trading sources said. Traders also expect cargoes of gasoline and blending components to sail east as refineries in Asia enter maintenance in April and the gasoline-producing RFCC at the ADNOC refinery is expected to remain closed until the first quarter of 2018 following a fire at the refinery earlier this year.
Traders also said that demand for mixed aromatics was strong in other key export markets. Refinery maintenance in Asia is expected to be the highest on record in April, with close to 1 million barrels per day more of capacity closed compared with a year earlier, according to consultancy Energy Aspects. Nigerian oil tanker drivers ended a strike over pay and the poor condition of the roads just hours after it began on Monday, following a government intervention, ending the threat of fuel shortages developing. Still, close to 2 million tonnes of clean products have loaded for West Africa over the past month, according to Reuters data, which market sources said was likely to inundate the region and limit new bookings.
Gunvor sold to Shell one barge of Eurobob benchmark gasoline in the afternoon window at $560 a tonne fob ARA. This compared with bids the previous day at $545-$546 a tonne. Elsewhere during the day, 20,000 tonnes traded, including at $546 a tonne fob ARA earlier in the day, and $554 and $560 a tonne later in the day, up from $548 a tonne on Monday. Gunvor sold to Shell, Varo and BP.
No barges of premium unleaded gasoline traded. Offers were seen at $578 a tonne fob ARA, up from offers at $567 a tonne on Monday. The May swap traded at $561 a tonne at the close, up from $554.50 on Monday. Brent crude futures were up by 90 cents at $54.02 a barrel by 1539 GMT. Gasoline barge refining margins stood at $12.24 a barrel, softening from roughly $13 a barrel on Monday.