Gasoline cracks soften again Friday

European oil markets were little changed Friday, but the recent trends continued with gasoline softening again versus crude in the wake of Wednesday's surprise news of a build in US gasoline stocks and a drop in implied demand for the road fuel.

Meanwhile distillate cracks ticked higher again.

Brent was trading just 26 cts/b higher at 16.30 UK time Friday compared to yesterday, but May and June Low Sulfur Gasoil future contracts settled $3/mt (40cts/b) higher.

Gasoline's loss has been distillates gain with the structurally short European market hoping to see less trans-Atlantic imports from the US Gulf than previously anticipated.

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Against the run of crude, premium unleaded gasoline barges in AR dropped lower after the market was offered at $613.50/mt and bid at $609/mt. Eurobob E5 gasoline in AR was a fraction higher over the day, gaining 75 cts/mt (11cts/b), and continuing to trade at a $4/mt discount to May paper.

Naphtha cracks weakened for the second day in a row, with the CIF cargo price in northwest Europe also up just 0.75 cts/mt (8cts/b).

Diesel and gasoil distillates saw mild low single digit $/mt rises as the markets largely followed the distillate futures.

Jet fuel FOB barge premiums in FARAG fell to $19.50/mt above front month Low Sulfur Gasoil futures, from $20.75/mt previously, to register only a small rise in the flat price.

Meanwhile, reversing a recent trend at the bottom of the barrel, high sulfur fuel oil barges gained $2.50/mt in ARA, increasing its crack value for the first time this month. But the HSFO crack value versus Brent futures was still left hovering around -10/b, down sharply from the -$7.50 to -$7/b range seen before OPEC and its allies decided in early April to increase more sour crude supplies this quarter. The market was also impacted by the closure of the Suez Canal.