22 January 2013 23:59 [Source: ICIS news]
LONDON (ICIS)--Sellers in the European jet kerosene market have been lured by higher prices, with a number of trades conducted, sources said on Tuesday.
A total of seven barge trades were conducted during open market trading from 16-22 January.
Barge differentials were at $71-73/tonne (€53-55) on Tuesday, well below cargoes at $83-85/tonne.
Market participants were at odds over the reasons for strong cargo differentials. However, many agreed the market is well supplied and freight costs may be contributing to higher cargo differentials.
According to ICIS data, Tuesday’s barge price of $1,040.75-1,042.75/tonne FOB (free-on-board) ARA (Amsterdam-Rotterdam-Antwerp) is the highest since 22 October 2012.
The outright jet kerosene price increase is a result of firmer ICE gasoil values, which are currently being supported by cold European weather conditions, as gasoil can be used for heating requirements.
However, the cold snap is not creating extra demand for dual purpose kerosene, sources said.
An airline source said as a result of flight cancellations across Europe, there could be more product in storage tanks.
The source said storage at airports is limited and volumes may need to be held further up the supply chain until normal flying schedules resume.
Stocks for jet kerosene in the ARA region were at 335,000 tonnes on 17 January, up from 280,000 tonnes the previous week.
Storage stills remain unfavourable, with the Intercontinental Exchange (ICE) gasoil market structure back-dated at around $9/tonne between February and March contracts.
($1 = €0.75)
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