Traders in Germany noted a significant increase in diesel demand at the start of the past week because of lower prices and the transition to winter-grade fuel. Spot sales of heating oil and gasoline rose, particularly in the south and southwest.
Middle distillates in Germany traded on 11-12 November at lower prices than in the week prior, pressured by declining Ice gasoil futures. But these rose in the following days. There is uncertainty in the market around the potential impact of US President-elect Donald Trump's trade policy from January.
The upcoming switch to winter diesel in Germany could be leading to increased demand. Most tank storage and refinery operators have, since 1 November, been offering diesel and gasoline in winter quality. Only winter-grade fuel can be dispensed from 16 November. Consumers in recent weeks have been ordering smaller amounts of diesel, waiting for the switch to winter specification before replenishing stocks, traders told Argus.
Consequently, diesel spot volumes reported to Argus increased to the highest this year on 11 November. Traded quantities of heating oil and gasoline also rose. But buying interest for middle distillates and gasoline weakened as the week went on.
This month has seen high imports into northern Germany and elevated refinery production. On the Rhine river, falling water levels at the Kaub bottleneck has led to increased freight rates from Amsterdam-Rotterdam-Antwerp (ARA) to destinations on the Upper Rhine. But demand for shipping space from importers in mid-November is so weak that the effect of low water levels on the rates was dampened, shipowners said. Water levels are forecast to rise in the coming days.
TotalEnergies' 240,000 b/d Leuna refinery in eastern Germany, close to the border with Czech Republic, ended a maintenance shutdown in the past week. The shutdown had only minor effects on product availability but lasted longer than expected because of technical problems when ramping up. Leuna producing again marks the end of this year's maintenance season in Germany.
