ARA Oil Product Stocks Tick Back Up (Week 50 – 2020)

December 10th, 2020 — Inventories of oil products held in independent storage in the Amsterdam-Rotterdam-Antwerp (ARA) trading hub have risen over the past week, according to data from consultancy Insights Global, after reaching their lowest since April a week earlier.

Total oil product stocks rose in the week to 9 December, reversing some of the losses recorded the previous week when product stocks suffered their steepest week on week decline since January. European demand remains under heavy pressure from lockdown measures in key markets France and Germany.

A slight week on week recovery in Rhine water levels helped bring more refined products into the ARA area from the European hinterland.

Gasoline stocks were lower, with outflows from the region rising on the week. Tankers departed for South Africa, the US and west Africa.

The volume of gasoline blending components coming into the region from the European hinterland was stable at a high level for a third consecutive week, supported by the rise in Rhine water levels. Component flows into the ARA from inland Rhine destinations was very limited for the preceding two months before rising in late November.

Fuel oil inventories also fell, reaching three-month lows. As with gasoline, the drop in stocks was the result of high outflows to regions where end-user demand is firmer.

Tankers departed for the Mediterranean, west Africa and Saudi Arabia. The tanker which departed for Saudi Arabia was an Aframax, probably containing high sulphur fuel oil.

Stocks of all other surveyed products rose. Low local demand for road fuels combined with a seasonal slowdown in the northwest European market to limit flows from the ARA area up the Rhine into Germany. Tanker inflows also fell on the week, with relatively low volumes arriving from the USA and Saudi Arabia.

But tanker outflows were also low, with just one cargo departing for the UK.

Naphtha stocks leapt on the week, after falling a week earlier. The recovery in inventory levels was the result of cargoes arriving from the Russian Baltic and Algeria against a backdrop of poor demand from gasoline blenders in the ARA area. Flows of naphtha up the river Rhine to petrochemical end-users slowed on the week, but flows on the route are unlikely to stay low owing to naphtha’s competitive pricing relative to other feedstocks.

Jet fuel stocks rose after reaching their lowest weekly level since August a week earlier. The arrival of tankers from Kuwait, North Sea floating storage and the UAE offset a rise in westbound transatlantic departures, as well as the departure of cargoes for the UK and Ireland.

Reporter: Thomas Warner