Europe gasoil traders at odds with OPEC on buoyant prices

12 October 2010 15:03  [Source: ICIS news]

LONDON (ICIS)--The current upward trend in European gasoil prices could be sustained by upcoming refinery turnarounds and fewer exports from Russia despite significant stock levels, OPEC said in its October monthly report on Tuesday.

However, players in both the gasoil barge and cargo markets did not agree with this positive outlook.

Although there was a consensus that stock levels were indeed very high, producers and brokers were of the opinion that the market was quiet and demand extremely poor, particularly from Germany.

A broker added that there was always some maintenance taking place, and was not aware of any forthcoming increase in the upkeep of refineries.

None of the players contacted said they had heard of any change in Russia’s exports.

Furthermore, both producers and brokers predicted a forthcoming contango situation. This would encourage sellers to hold stocks, thereby further decreasing activity in the market, a source said.

At 10:55GMT November Brent was at $82.88/bbl, down $0.84/bbl, while November WTI was at $81.33/bbl, down $0.88/bbl.

The ICIS gasoil cargo prices were pegged at $725-730/tonne (€522-526/tonne) CIF (cost, insurance and freight) NWE (northwest Europe).

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By: Jo Pitches
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