Outright prices for ultra low sulfur diesel across Europe have fallen to their lowest in 15 months, tracking falls in the oil futures complex.
CIF delivered Mediterranean cargoes fell to $875.25/mt on Tuesday, Northwest European cargoes fell to $873.75/mt, and Rotterdam barges fell to $867.75/mt, all lowest since May 31, 2013, Platts data shows.
The ICE gasoil futures September contract closed at $854.50/mt Tuesday, its lowest level since August 18, when it was at $853.25/mt.
The fall in ICE gasoil futures tracked a sharp drop in ICE Brent oil futures Tuesday, when the contract dipped below $102/barrel, as Libyan production continues to ramp up, offsetting any geopolitical risk premium due to the conflicts in Ukraine and Iraq.
The European diesel/gasoil market has been faced with a supply glut after ample imports from the US and Russia combined with weak regional demand have caused rapid build-ups of gasoil/diesel in storage and a persisting contango in the ICE gasoil futures curve.
The latest inventory data from BNP Paribas highlights that Amsterdam- Rotterdam-Antwerp distillates stock levels are at 31.9% above the five-year average.
