Oil Products Summary at European Close: EU Gasoil Backwardation Strengthens

European Gasoil backwardation has strengthened slightly since the time spreads reached a low on about Nov 10 amid low stocks in Europe and US and with tight supplies ahead of a drop in European temperatures. The prompt spread has recovered from a low of around 10$/mt back to 18$/mt today but remain down from the levels over 35$/mt in earlier November, while longer term time spreads have followed a similar pattern with Dec23-Dec24 spread recovering from 44.5$/mt on Nov 9 to 69$/mt.

• Gasoil DEC 23 up 0.4% at 825$/mt
• ULSD DEC 23 down -0.4% at 2.88$/gal
• Gasoil DEC 23-JAN 24 down -0.5$/mt at 17.75$/mt
• Gasoil DEC 23-DEC 24 down -4.25$/mt at 70.25$/mt
• EU Gasoil-Brent up 0.4$/bbl at 27.38$/bbl
• US ULSD crack up 0.9$/bbl at 41.37$/bbl
• The CDU at Valero’s 235kbpd Port Arthur refinery in Texas will go under maintenance in January, people familiar with the operations told Reuters.
• The 76kbpd gasoline-producing fluidic catalytic cracker-2 (FCC-2) at TotalEnergies’ 238kbpd Port Arthur refinery in Texas is currently operating at 75% of capacity after Tuesday’s restart, people familiar with plant operations told Reuters.
• A power plant linked with Exxon’s Antwerp refinery has been halted due to a fault according to a Nordpol alert.
• China’s gasoline demand is expected to peak at 170mn tons at around 2025, Qiu Xuan, a researcher with PetroChina Planning & Engineering Institute, said, cited by Bloomberg.
• China’s gasoil demand is expected to rise to 220.8mn tons this year, up by 3.09% on the year according to OilChem.
• Chinese gasoline exports are expected to decline by 10% on the year on 2023 to 11.77mn tons due to poor margins, JLC analyst, Wang Yanting, said.
• Italian oil product sales totalled 4.51mn tons in October, lagging pre-Covid levels for the eleventh straight month, data from Italy’s Ministry of Environment and Energy showed.