En Español

Very usefull links


News links




Dow Jones

Oil price



Views and News





Diesel market is booming in Asia and draws rare European cargoes



Petroleumworld 07 06

Oil traders are shipping diesel out of Europe to Asia and the Middle East where strong demand and tighter supplies have boosted prices, in a rare arbitrage that reverses traditional routes.

At least three 90,000 tonne diesel cargoes were booked in recent days out of northwest Europe options to go to Singapore and the Middle East, shipping data showed.

BP chartered the long-range Nan Lin Wan and Front Antares tankers for loading out of the Amsterdam-Rotterdam-Antwerp storage and refining hub in mid-July, the data showed.

Vitol booked the 90,000 tonne Navig8 Goal tanker loading out of the Baltics with destination option for the Middle East also in mid-July, Singapore and northwest Europe.

"It's very unusual for diesel cargoes to flow from Europe to the Far East. I don't remember this happening in the past few years," a Singapore-based shipbroker said.

Asia's diesel refining margins have received a reprieve recently, climbing to a 2-1/2-month high this week as a buying spree from India that began in April and higher than usual regional refinery maintenance lowering supply.

Europe, where around half of Europe's car fleet runs on diesel, imports diesel as local refineries can not meet regional demand.

Imports from the Middle East and Asia, where a large number of state-of-the-art refineries have been constructed in recent years, have steadily increased to become a regular source of supply for Europe.

But still, the strong Asian market in recent weeks has opened the rare arbitrage. The Netherlands shipped nearly 100,000 tonnes of diesel to Singapore in late June, data from trade agency International Enterprise showed.

The trade may be workable for some traders though not for many, a Singapore-based trader said.

"BP is likely shipping the cargo east as they are massively short in Asia," a London-based trader said. "But there are not that many 10ppm shorts in Asia-Pacific except for Australia, so it will only work for a few players who have shorts there," he added.

Europe imported around 1.4 million barrels per day of gasoil, which includes mostly diesel but also heating oil, in 2016, more than one fifth of the region's 6.2 million bpd demand, International Energy Agency data showed.

Story by Ron Bousso and Jessica Jaganathan;Editing by Duncan Miriri from Reuters.

07 05 2017

We invite all our readers to share with us
their views and comments about this article.
Write to editor@petroleumworld.com

By using this link, you agree to allow PW
to publish your comments on our letters page.

Any question or suggestions,
please write to: editor@petroleumworld.com

Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8,10 +/ 800x600 pixels








Contact: editor@petroleumworld.com,

Editor & Publisher:Elio Ohep/
Contact Email: editor@petroleumworld.com

CopyRight © 1999-2016, Paul Ohep F. - All Rights Reserved. Legal Information

PW in Top 100 Energy Sites

CopyRight©1999-2017, Petroleumworld   / Elio Ohep - All rights reservedThis site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission fromPetroleumworld or the copyright owner of the material.