Rare arbitrage to Europe opens

摘要

US light sweet LLS has collapsed relative to Atlantic basin marker North Sea Dated, opening a rare reverse arbitrage to move crude from the US Gulf to Europe (see upper graph). But the arbitrage cannot be exploited because it is illegal to export US crude. Instead, North Sea Dated related crudes that might usually go to the US Gulf are looking for alternative outlets. Weak naphtha demand in Europe and a closed arbitrage to Asia-Pacific has led to the build up of excess supplies in north- west Europe, forcing traders to look elsewhere for markets. Although demand for naphtha for gasoline blending is weak in the US, 660,000 bl of naphtha has been booked from northwest Europe to the US this month (see lower graph).