Increased diesel consumption from Germany's agricultural sector is boosting sales, while reduced production capacities in the south and west are limiting supplies.
Traded diesel volumes reported to Argus rose by about 14pc on the week in the seven days to 15 March as traders noted more buying interest from farmers, construction and transportation.
Demand is likely to increase even further in the coming weeks, according to traders, as more and more farmers take to their fields.
This comes at a time when production in Germany is curtailed. The Bayernoil consortium's
215,000 b/d Neustadt-Vohburg refinery in Bavaria began a planned turnaround around two weeks ago. The operators expect the maintenance to last for around four weeks, during which time the 125,000 b/d Vohburg site will remain offline.
Traders in the region are reporting reduced availability of distillates, especially of heating oil.
Shell's 147,000 b/d Wesseling refinery is running at reduced capacity after a desulphurisation unit went offline at the beginning of the month. The unit has not resumed production.
The Miro consortium's 310,000 b/d Karlsruhe refinery will start a planned shutdown in April, which could restrict supply.
So far, available supply is sufficient to meet demand. Should demand continue to increase and the reduced refinery output persist, Germany could grow more reliant on diesel imports along the Rhine river.
Exports to Poland on the rise
A unit outage at the PCK consortium's 230,000 b/d Schwedt refinery has been resolved, bringing production back to its previous level.
But increased amounts of product are leaving Schwedt for Poland, where filling station operators emptied their inventories in the past few weeks in order to make room for transitional gasoline, which is traded from 1 March to 30 April. Operators have rebuilt their inventories mainly with imported gasoline from Schwedt, raising prices in the region.
