ARA Oil Products Stocks Fall Despite Gasoline Build (Week 47 – 2020)

November 19, 2020 — Total oil products held in independent storage in the Amsterdam-Rotterdam-Antwerp (ARA) trading hub fell on the week,
as a rise in gasoline and naphtha stocks was outweighed by falls in all other products, according to data from consultancy Insights Global.

Gasoline stocks rose to reach six-week highs as a result of dwindling demand from key export market the US Atlantic Coast.

Implied US gasoline demand fell to a four-month low in the week to 13 November, according to the latest EIA data.

The lack of demand pushed stocks to a seven-week high in the world’s largest gasoline consuming country and key export destination for European producers.

Tankers departed the ARA area for the US, but the total volume was eclipsed by the amount departing for west Africa and the Mediterranean.

Low demand in Europe and from export markets continued to weigh heavily on blending activity, reducing the quantity of gasoline blending components moving around the ARA area on barges despite barge freight costs on intra-ARA routes being at record lows.

Naphtha was the only other surveyed product to rise, with stocks increasing on the week to reach six-week highs. The lack of gasoline blending reduced local demand for naphtha as a blending component.

Demand from petrochemical end-users inland was marginally lower on the week, but is expected to stay robust throughout the winter owing to relatively high prices of rival feedstocks. The arrival of several cargoes from Russia and an LR2 from Algeria buoyed inventories further.

Gasoil inventories fell by almost 8pc to reach their lowest since the week to 30 April. Several cargoes departed for the US Atlantic coast as part of an unusual reverse arbitrage route that first emerged in October.

Tankers also departed for the UK and west Africa. Demand from along the River Rhine was low owing to high inventories inland.

Jet fuel stocks fell for a second consecutive week to five-week lows, but remained close to all-time record highs.

Tankers departed for the UK and Ireland while none arrived. Fuel oil stocks fell on the week to reach five-week lows. High sulphur cargoes departed for the Mideast Gulf and west Africa, while IMO-compliant very low sulphur fuel oil left the ARA area on intra-European routes. Cargoes arrived from the Caribbean, Finland and Russia.

Reporter: Thomas Warner