LONDON: Diesel barge differentials in northwest Europe rose on Friday as supplies in the region tightened with stronger demand for storage and due to colder weather.
The discount of the front-month February ICE diesel futures to the March contract, in what is known as contango, narrowed on Friday to around 75 cents as prompt buying in the region remains strong.
At the same time, refiners and traders have been storing diesel as the contango into December remains strong, limiting prompt supplies.
"Demand is picking up due to lower refinery output of diesel and low stocks as well as cheap outright price," a trader said.
Barge buying along the river Rhine in Germany and in France has been particularly strong in recent days due to cold weather, traders said.
German residential heating oil stocks were at 64 percent of tank capacity at the start of January, down 2 percentage points from the previous month, traders said on Friday.
The January levels were the highest since 2007 for this month and significantly above the five-year average of 60 percent, according to traders.
GASOIL
No barges of 0.1 percent gasoil traded. There were no bids or offers.
No barges of 50 ppm gasoil traded. Bids and offers were discussed at a range of minus $1 to plus $1 a tonne fob ARA above the ICE February ultra-low sulphur gasoil futures. * No cargoes traded.
The front-month February ultra-low sulphur gasoil contract was up 25 cents a tonne at $473.25 a tonne at 1656 GMT.
The ICE gasoil crack was at $14.56 a barrel, down from $15.66 a barrel.
The contango between the February and March contract was at $1 a tonne, 50 cents narrower than on Thursday.
Comments
Comments are closed for this article.