STOCKS DATA: Gasoline in ARA at year low, backwardation steepens

Quantum Commodity Intelligence - Gasoline and naphtha stocks continued to fall in ARA this week to underpin the strengthening cracks against Brent and widening backwardation in nearby curves, sources said, citing data from Insights Global.

Gasoline stocks drew around 100,000 mt over the week to Thursday (July 15) to 890,000 mt, the lowest this year, and down around 350,000 mt from the same week in 2019 before the Covid pandemic struck.

Meanwhile, naphtha stocks fell 46,000 mt over the week to 169,000 mt, also the lowest this year, and down around 100,000 mt since June 10.

Naphtha stocks are following the same pattern of 2019 where stocks also fell to around 169,000 mt at this time of year.

Both gasoline and naphtha prices in north Europe are trading in steep backwardation, according to Quantum data.  

Eurobob E5 gasoline barges in ARA traded as high as $10/mt above the August paper Thursday, the highest differential versus the front month paper this year, although earlier trades were around $7/mt higher, still up from last week.

Naphtha prices were assessed $14.75/mt above August paper Thursday, after backwardation between August and September paper widened to $10.50/mt.  

Stocks for fuel oil, which is also in backwardation, also dropped slightly this week, falling 29,000 mt to around 1.2 million mt, and around the same levels seen in late May.

But fuel oil stocks were around the same level as 1.2 million mt or lower, dropping to 1 million mt, in July 2019.

Meanwhile, jet and middle distillate stocks in ARA gained this week.

Jet stocks were up 63,000 mt to top 1.2 million mt, the highest this year, and to leave them around 400,000 mt higher than in July 2019.

Diesel and gasoil stocks were little changed, gaining 19,000 mt to 2.3 million mt, around its average over the last seven weeks.

But distillate stocks are much lower than July 2019 levels, down more than 300,000 mt.