ARA Oil Products Stocks Edge Higher
30 January, 2020 (Argus) — The total volume of oil products held independently in storage in the Amsterdam-Rotterdam-Antwerp (ARA) area rose on the week, steadying after a sharp drop from week highs in the previous week, according to the latest data from consultancy Insights Global.
Overall ARA stocks reached a bit higher than in the week to 29 January. The small rise was driven by a raise gain in gasoil inventories, which offset reductions in gasoline and fuel oil inventories.
Gasoil stocks rose in the week to 29 January, with cargoes arriving from India, Algeria, and Russia. Russian gasoil exports are likely to rise in January after the export schedule at the port of Primorsk was set at a multi-year high, up sharply in December. Gasoil cargoes departed ARA for west Africa and the UK. Lower prices in Europe have seen buying interest from west Africa pick up, which has prompted gasoil to depart Europe for west Africa in January, the highest since August. Demand in northwest Europe remains weak for gasoil, which could also explain the stockbuild.
Gasoline stocks dipped lower on the week, as exports rose. Cargoes departed ARA for Nigeria, the UAE, Puerto Rico, Libya and the UK. Exports from ARA to Puerto Rico have risen sharply this month, according to data from oil analytics firm Vortexa, with flows for January. The stockdraw could also have been driven by lower flows of gasoline along the Rhine into ARA, amid low water levels along the river. Gasoline arrived in ARA from Sweden, France and the UK over the monitoring period.
Fuel oil inventories in ARA dropped in the week to 29 January. Inflows into ARA came from Norway, the UK, and Germany, while no cargoes were spotted delivering fuel oil from Russia — the world’s principal fuel oil exporter — into ARA. Russia typically exports high-sulphur fuel oil, demand for which has been curbed by the IMO 2020 global marine fuel sulphur cap. Russian fuel oil has instead found firm demand in the US, where it is being purchased for coking units. Fuel oil tankers departed ARA for Malta this week, which could result in onward shipments east of Suez.
Naphtha stocks in the ARA gained, according to Insights Global. No naphtha cargoes departed the trading hub, while cargoes entered from Spain, France, Russia and the UK. Naphtha demand has weakened from the petrochemical sector amid falling prices of rival feedstock propane, while buying interest from gasoline blenders is also weak as a result of a closed arbitrage to the US Atlantic coast.
Jet kerosine inventories dropped on the week. Jet was delivered from the UAE, while no vessels were spotted taking jet out of the trading hub, implying the stock draw may have been linked to higher overland shipments. But jet fuel stocks in ARA could soon grow as a result of the coronavirus outbreak in China, which has resulted in the cancellation of thousands of flights globally, and severely hampered jet fuel demand in Asia-Pacific. That could result in more supplies heading into Europe from east of Suez.
Reporter: Robert Harvey