July cracks for gasoline in the Mediterranean crash lower
London (Quantum Commodity Intelligence) - July cracks for premium unleaded gasoline loading in the Mediterranean have fallen sharply in early trade Thursday, despite the June cracks ticking higher as flows to the US start to flow again this week, data from brokers show.
After no cargoes were loaded last week, flows of gasoline from the Mediterranean to the US are expected to reach 710,000 barrels for the seven days from May 26 to June 2, according to market sources, citing Kpler.
June cracks were pegged at $8.97/b at the time of the Singapore market close at 0930 UK time, up around $0.28/b from 1630 UK time Wednesday.
But the July crack for FOB premium unleaded gasoline in the Mediterranean was down a hefty $1.43/b from Wednesday to $9.18/b, according to brokers.
Gasoline cracks were also softer for cash prices in Singapore Thursday morning, and the softness of Asian demand amid persistence of Covid-19 in India seems to be weighing on the global gasoline complex.
Europe and US refiners also have room to increase production, with the latest US refinery utilization rates at 87%.
European gasoline cash prices and cracks rallied Wednesday after the release of the US weekly oil inventory report from the EIA.
That data showed a 1.7 million-barrel draw in gasoline stocks over the week to May 21, and an uptick of 242,000 bpd of gasoline supplied, or implied demand, to 9.479 million bpd, pushing it above the five-year average.
But Wednesday's gains were slight in the wake of a sustained sell-off in gasoline cracks since early May.
Cracks for June Eurobob barges in AR, the main swap for gasoline in Europe, had fallen from a peak of $11.67/b on May 5 down to a low of $9.41/b on Tuesfay, May 25, before Wednesday's gain to
Kpler data shows gasoline imports into the US Atlantic Coast hit a 4-year high of 6.5 million barrels over the week to May 23, up 1.5 million barrels from a week earlier.
Some 3.05 million barrels came from Europe, and most o them, 2.17 million barrels from the Netherlands.
US imports are forecast to rise to 7.06 million barrels over the week to June 2, with 4.93 million barrels coming from Europe.
