European Gasoline Crack Advances; ICE Gasoil Gains: Oil Products

European gasoline barges and its crack, or premium to Brent crude, advanced to the highest level since October as Cargill Inc. bought the fuel.

Gasoil gained to the most in about five weeks on the ICE Futures Europe exchange in London as Brent rose.

Light Products

Gunvor Group Ltd. sold a 1,000 metric-ton barge at $983 a ton in the Amsterdam-Rotterdam-Antwerp area, according to a Bloomberg survey of traders and brokers monitoring the Argus Bulletin Board. That compares with deals from $970 to $981.50 yesterday and $1,005 on Oct. 19. Ethanol is added to the Eurobob grade to make finished fuel.

Gasoline’s crack rose to $7.19 a barrel as of 10:51 a.m. local time, according to data from PVM Oil Associates Ltd., a broker in London. It was $7.09 yesterday and $7.25 on Oct. 15.

Naphtha’s crack, or discount to Brent, narrowed to $5.90 a barrel from $6.01 the previous session, according to PVM data.

Middle Distillates

Gasoil for January delivery rose $10.75, or 1.2 percent, to $949.25 as of 12:08 p.m. London time on the ICE exchange.

The contract’s discount to February futures was $1.75 a ton, keeping the market in contango, a structure that can signal falling demand or rising supply.

Gasoil’s crack advanced to $15.31 a barrel versus $14.81 in the previous session. Brent gained 0.9 percent to $112.40 a barrel on ICE.

Structural deficits in global gasoil balances create risks of a spike in the price of the fuel, according to Deutsche Bank.

“An improving macro backdrop, particularly in the second half of 2013 and as China returns to potential growth rates, should prove supportive for this part of the barrel,” the bank said today in an e-mailed note.

To contact the reporter on this story: Konstantin Rozhnov in London at krozhnov@bloomberg.net

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

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