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German Diesel Premiums Drop; Naphtha Cargoes Slip: Oil Products

As much as 110,000 metric tons of European diesel traded while the premium for the product in Germany dropped. Trafigura Beheer BV sold naphtha cargoes for a seventh session.

French oil refinery workers plan to hold a strike on Nov. 5, according to a union official.

Light Products

Naphtha declined to trade from $923 to $927 a ton, according to a survey of traders and brokers monitoring the Platts Pricing window. That’s down from a trade at $928 a ton yesterday. Trafigura, Royal Dutch Shell Plc and Glencore were the sellers. Vitol Group and BP Plc (BP/) bought.

Naphtha’s crack, or discount to Brent, shrank for a fourth session to $4.72 a barrel at 2:07 p.m. London time from $4.98 yesterday, according to data from PVM Oil Associates Ltd., a crude and products broker. That’s the least since Oct. 8.

Barges of gasoline for loading in the Amsterdam-Rotterdam- Antwerp hub traded at $930 to $946 a ton, according to a survey of traders and brokers monitoring the Argus Bulletin Board and Platts. That compares with deals yesterday from $950 to $959 and is the lowest since June 28, data compiled by Bloomberg show.

Morgan Stanley, Chevron Corp. (CVX) sold the Eurobob grade, to which ethanol is added to make finished fuel. BP and Cargill Inc. purchased barges, which usually comprise 1,000 tons to 2,000 tons. Gunvor Group Ltd. both bought and sold.

The fuel’s crack, or premium to Brent crude, rose to $3.34 a barrel, the PVM data showed. That’s up from $3.16 yesterday.

Middle Distillates

Glencore International Plc sold a cargo of ultra-low-sulfur diesel to Total SA for delivery to Kiel, Germany, according to the survey of Platts. The shipment changed hands at a $57 a ton premium to November gasoil on the ICE Futures Europe exchange, down from a trade at $59 yesterday.

OAO Lukoil’s Litasco unit vended a cargo to North Sea Group for delivery to Amsterdam at $51 a ton more than November futures. Repsol YPF sold two lots partly priced at discounts of $5 a ton and $6 to the Mediterranean benchmark. Shell sold two shipments at $7 premiums versus the northwest Europe price.

Barges of the fuel were little changed at premiums of $47 a ton and $48. North Sea Group was the main seller and Vitol was the most active buyer.

In the heating oil market, Gunvor vended two cargoes, according to the survey of Platts. Phillips 66 bought the first shipment at $19 more than November gasoil and Vitol bought the second, partly priced at parity to the northwest Europe benchmark.

Barge premiums slumped to trade at $5 to $8, versus $8 to $10 yesterday. BP was the only seller for a second session.

Gasoil for November delivery was stable at $955.25 a ton as of 5:28 p.m. London time on the ICE exchange. It settled at $954.75 yesterday, the lowest since Aug. 7. The December contract was at $939 a ton, widening its discount to the front month by $1 to $15.75.

Gasoil’s crack, or premium to Brent, was little changed at $18.67 a barrel as of 4:30 p.m. Brent decreased 0.9 percent to $107.25 a barrel.

Crude demand from German refiners is “particularly strong at the moment due to strong middle distillate cracks and the recent restart of the Ingolstadt refinery,” Vienna-based researcher JBC Energy GmbH said in a note today.

Residues

High-sulfur fuel oil traded from $595.50 to $596.25 a ton, the Platts survey showed. That compares with $595 to $598.50 yesterday. The low-sulfur grade changed hands at $628 to $628.50 a ton, up from $624 to $625 yesterday.

The spread between the two grades widened to $32 a ton. It narrowed to $27.50 a ton yesterday, the least since Feb. 27, according to Bloomberg data.

Refineries

French oil refinery and terminal workers will hold the strike on Nov. 5, Chris Votte, an official at the CGT union said by phone today. The staff are protesting against the possible closure of the Petit-Couronne refinery, he said.

Mineraloelraffinerie Oberrhein GmbH halted for maintenance an alkylation unit at its 310,000 barrel-a-day Karlsruhe refinery, the largest in Germany, two people with knowledge of the work said.

The unit was shut earlier this month for work that includes a column change and will remain offline for at least four weeks, the people said, declining to be identified because they’re not authorized to speak publicly about the matter.

OMV Petrom SA, Romania’s biggest oil company, will halt its Petrobrazi refinery in 2014 to install a vacuum gasoil unit following its upgrade, Bertram Muchan, head of operations management in the company’s refining division, said at a conference in Bucharest today.

Naftna Industrija Srbije AD, a Serbian oil and gas company, will start new units at its Pancevo refinery in November, Ivan Soucek, an adviser to NIS director of strategy, said at the same conference.

To contact the reporter on this story: Lananh Nguyen in London at lnguyen35@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

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