Spot product prices rose across the barrel in the week to Sept. 30, as the prompt market largely followed the paper market, which rallied following news that OPEC set in place a framework deal which could result in capped production rates. ULSD refining margins jumped to a three-month high on Thursday following a rally in the futures benchmark price. However, the futures rally, which was spurred by news that OPEC agreed to framework deal that might result in production caps, subsequently pulled back following market players' skepticism of the deal. Refining margins also got a boost from expectations of fewer imports from the US and Russia in Oct., due to refinery maintenance, driving up refining margins to a four-month high on Friday. Demand for middle distillates in the inland markets was subdued by high freight rates, due to low water levels on the Rhine River, making transportation of products to and from the ARA storage hub difficult. Although, diesel volumes were being pulled from Northwestern Europe to the Mediterranean, with shipments heading to Algeria, Egypt, and Turkey, market sources noted. Gasoil stocks in Europe's ARA storage hub inched up, putting some downward pressure on diesel and heating oil prices, especially amid downed refining capacity in Europe and abroad has limited production. Jet fuel stocks dipped, however, putting a floor under differentials. Heating oil and jet fuel prices posted strong increases.
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