LONDON: Benchmark diesel refining margins in northwest Europe rose for a third straight session on Monday amid a recovery in oil prices despite a persistent product overhang.
The arbitrage from Europe to the United States briefly opened on Friday, with at least one 44,000 tanker booked on the route, according to traders and shipping data.
Demand in the northwest European market was limited as price idea gaps between buyers and sellers remained wide, traders and brokers said.
The Mediterranean market was supported by demand from Turkey, where Tupras issued a tender to buy one cargo of 10 ppm or 25 ppm gasoil for delivery on August 15-25.
Egypt's EGPC also issued a tender to buy 4 cargoes of 0.1 percent sulphur content gasoil for delivery on August 25-27 into the ports of Alexandria and Suez.
German consumer heating oil stocks at the start of July rose to 58 percent of tank capacity from 57 percent a month earlier, according to data from a trade source. July's levels were the highest since 2009 for this time of year and four percentage points above the five-year average.
Around 1.5 million tonnes of diesel are expected to be imported into Europe and the Mediterranean from the United States and an additional 1.8 million tonnes from the Middle East and Asia, according to traders and shipping data.
Around 370,000 tonnes of diesel remains in floating storage in northwest Europe and the Mediterranean, according to shipping data and traders.
GASOIL
Barges of 0.1 percent sulphur content gasoil traded at discounts of $2 a tonne fob ARA to the August Low Sulphur Gasoil futures.
Barges of 50ppm sulphur gasoil traded at a discount of $2.75 a tonne fob ARA to the August Low Sulphur Gasoil futures, compared with discounts of $3 a tonne on Friday.
No cargoes traded.
August Low Sulphur Gasoil futures were trading $14 a tonne higher at $356.50 a tonne at 1539 GMT.
The August contract traded in a contango of $5.75 a tonne to the September contract, unchanged.
The diesel refining margin was at around $8.11 a barrel, up from $8.11 a barrel.
DIESEL
Barges of 10 ppm diesel traded at discounts of 75 cents to $1.50 a tonne fob ARA to August diesel futures, a slightly wider range than a day earlier.
Glencore sold to BP one cargo cif basis Hamburg.
JET FUEL No barges traded. There were no bids or offers.
No cargoes traded.
Vitol offered one cargo at $21.50 a tonne cif Rotterdam above the September diesel futures.
FUEL OIL
Barges with a sulphur content of 3.5 percent fuel oil traded at $210-$211 a tonne fob ARA, compared with $203-$206.50 a tonne a day earlier.
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