LONDON: Diesel barge price differentials in northwest Europe held steady on Thursday as the pace of gasoil stock building in the Antwerp-Rotterdam-Amsterdam hub slowed, with the arbitrage from the United States largely shut off.
Data from Dutch consultants PJK International showed that gasoil stocks were at their highest since May 2011 but that the week-on-week increase had slowed with only 24,000 tonnes added in the week to Thursday.
The prompt contango in diesel futures, when the prompt February contract trades above the March futures, has flipped in recent days, limiting demand for storage, traders said.
But the diesel market remained in a deep contango of around $42 a tonne going into December 2015, meaning that storing product was still highly attractive, said traders.
On the supply side, imports from the US Gulf Coast were expected to remain at relatively low levels.
"The US arb is slammed shut as it has been for a while. Storage economics at the front of the market have evaporated, so demand is gone for that," said one trader.
Latin American demand has drawn diesel from the US Gulf Coast and made it less profitable to ship to Europe.
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