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NWE ULSD cargo premium to Rotterdam barges at 5-month low on expected supplies
The premium of CIF Northwest European ultra low sulfur diesel cargoes to FOB Rotterdam barges fell to $1.75/mt Friday, having shed $10/mt in as many days as a growing number of cargoes were expected to arrive in NWE later this month to relieve tight supply in the region.
The expectation put downward pressure on the Le Havre CIF NWE cargo premium to May 0.1% ICE gasoil, which closed at $26.25/mt on Friday, down $5.75/mt from the start of the month.
Meanwhile, the Rotterdam barge premium reached a seven-month high at $24.50/mt FOB on Friday amid a sustained spree of prompt buying interest in the Amsterdam-Rotterdam-Antwerp barge market, leaving the premium of CIF cargoes to FOB barges at its lowest since November 1, Platts data showed.
Total middle distillate stocks in ARA are at record lows with gasoil stocks well below the five-year average, according to a report from French bank BNP Paribas published Friday.
Swaps have also been trading in a more pronounced backwardated structure this week. The front- to second-month NWE diesel swaps have been trading in backwardation since March 20 after trading in a contango structure over the previous few months, according to Platts data.
The switch from a contango to a backwardated structure in mid-March coincided with exports from ARA to the Mediterranean after an open arbitrage to the southern region allowed several traders to sell their ARA stocks at attractive prices.
Vitol and Shell were two of the companies heard exporting diesel cargoes from ARA to the Mediterranean, according to traders, and are current buyers in the barge market.
Source: Platts
The expectation put downward pressure on the Le Havre CIF NWE cargo premium to May 0.1% ICE gasoil, which closed at $26.25/mt on Friday, down $5.75/mt from the start of the month.
Meanwhile, the Rotterdam barge premium reached a seven-month high at $24.50/mt FOB on Friday amid a sustained spree of prompt buying interest in the Amsterdam-Rotterdam-Antwerp barge market, leaving the premium of CIF cargoes to FOB barges at its lowest since November 1, Platts data showed.
Total middle distillate stocks in ARA are at record lows with gasoil stocks well below the five-year average, according to a report from French bank BNP Paribas published Friday.
Swaps have also been trading in a more pronounced backwardated structure this week. The front- to second-month NWE diesel swaps have been trading in backwardation since March 20 after trading in a contango structure over the previous few months, according to Platts data.
The switch from a contango to a backwardated structure in mid-March coincided with exports from ARA to the Mediterranean after an open arbitrage to the southern region allowed several traders to sell their ARA stocks at attractive prices.
Vitol and Shell were two of the companies heard exporting diesel cargoes from ARA to the Mediterranean, according to traders, and are current buyers in the barge market.
Source: Platts
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