LONDON: Gasoline refining margins in northwest Europe rose on Friday to near $7 a barrel, supported by exports and increased buying for storage. European refineries continued to operate at high rates to benefit from strong profit margins, increasing available supplies while regional demand was weak, traders said.
"Winter demand is still weak and there is no reason for this to change," a trader said. Prices continued to benefit from increased buying for storage as prompt prices traded below future prices in what is known as contango.
"A lot is being stored," one trader said.
Independent ARA storage of gasoline has risen 11 percent since last week to 763,000 tonnes, the highest in a month. Naphtha stocks were up 29 percent at 306,000 tonnes.
Several new tanker fixtures appeared on Friday, bringing the total volume of gasoline exports to the US East Coast to around 350,000 tonnes this week, according to Reuters shipping data and trading sources. Seven tankers have also been booked in the last week to ship about 354,000 tonnes of what traders say is mostly gasoline to West Africa.
Gunvor also booked an 80,000 tonne gasoline cargo for loading Jan. 26-28 from ARA to Yemen, where the local refinery has stopped operating, traders said.
Russian gasoline exports rose 31 percent in December from the month before, while shipments of gas oil and fuel oil increased by 3.4 percent and 1.2 percent respectively, energy ministry data and Reuters calculations showed.
Naphtha refining margins held near a one-year high as demand from Asia lent support, traders said.
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