Diesel Premium Falls as BP Sells; ICE Gasoil Gains: Oil Products

Jan. 24 (Bloomberg) -- Diesel premiums in northwest Europe dropped to a 13-month low as BP Plc sold on the barge market.

Gasoil rose to the highest in almost three months on the ICE Futures Europe exchange as Brent crude advanced. Gasoline barges advanced for a sixth day.

Light Products

European naphtha cargoes traded at $943 and $945 a metric ton, according to a Bloomberg survey of traders and brokers monitoring the Platts pricing window. That compares with trades from $945 to $948 yesterday. Vitol Group sold two lots, taking its total to at least 30 cargoes this month. Glencore International Plc and Gunvor Group Ltd. bought.

Naphtha’s crack, or discount to Brent crude, widened to $6.92 barrel as of 2:14 p.m. London time, according to PVM Oil Associates Ltd., a crude and refined products broker. It was at $5.99 yesterday.

Gasoline in the Amsterdam-Rotterdam-Antwerp oil hub gained to as much as $1,017 a metric ton, the highest since Oct. 17, according to a similar survey of the Argus Bulletin Board. Barges changed hands from $1,006 to $1,015 a ton yesterday.

Vitol, Total SA, Trafigura Beheer BV, Chevron Corp. and Gunvor sold the Eurobob grade, to which ethanol is added before being sold at the pump. Cargill Inc., BP Plc, Argos Groep BV and Vitol bought on the barge market, where lots of 1,000 and 2,000 tons are usually traded.

Gasoline’s crack, or premium to Brent, fell 89 cents to $8.35 a barrel, PVM data show. It rose to the highest level since Oct. 11 yesterday.

The flow of European gasoline to the U.S. is poised to decline in the next two weeks as record fuel stocks for the time of year deter imports and cause shipping rates to slump, a separate Bloomberg survey showed.

Traders and oil companies will book 24 tankers to load the fuel during the two weeks to Feb. 6, according to the median estimate in a survey yesterday of seven shipbrokers and traders specializing in the trade. A week ago they expected 27 ships to be chartered in the corresponding period.

Middle Distillates

Gunvor sold a cargo of heating oil to Vitol at a $4 a-ton premium to February gasoil for delivery to Elefsis, Greece, according to the survey.

Diesel barges traded at $8 and $9 a ton more than February gasoil, compared with plus $9 and $10 yesterday, the survey of Platts showed. That’s the lowest since Dec. 19, 2011, according to data compiled by Bloomberg. Vitol bought all lots. Glencore, Royal Dutch Shell Plc and Total SA sold.

Gasoil for February delivery climbed as much as $6, or 0.6 percent, to $976.75 on the ICE exchange, the highest since Oct. 29. It was at $973.25 as of 5:24 p.m. London time.

Gasoil’s crack was at $16.36 a barrel as of 4:30 p.m. London time, down from $16.51 yesterday. Brent gained 0.4 percent to $113.29 a barrel.

Gasoil stockpiles in independent storage rose to a four-month high in Europe’s Amsterdam- Rotterdam-Antwerp oil-trading hub, according to PJK International BV. Inventories increased 9.2 percent to 2.42 million metric tons in the week to today, the most since Sept. 6, according to PJK. That figure includes heating oil and diesel.

Residues

High-sulfur fuel oil changed hands from $614.50 to $616.50 a ton, the survey of Platts showed. That compares with $611 to $612 in the previous session. The low-sulfur grade traded from $645 to $647 a ton, versus $636 to $641 yesterday.

Tenders

Egyptian General Petroleum Corp. issued a tender to purchase one gasoline cargo for delivery in March, according to a document obtained by Bloomberg News.

The state-owned company is seeking to buy 30,000 to 35,000 metric tons for delivery to the Red Sea port of Suez on March 8 to March 10, the document showed. The tender closes on Feb. 4 and offers are valid until Feb. 11.

Refining

Gunvor plans to build refineries, Chief Executive Officer Torbjorn Tornqvist said today in an interview in Davos, Switzerland.

The company, which bought plants in Antwerp, Belgium and Ingolstadt, Germany last year, can extract better value from crude processing that major oil companies, he said.

“We are actually planning to construct a couple of refineries around the world and we are looking for investment opportunities outside Russia as well,” Tornqvist said, declining to say where the facilities may be located.

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