Waning German products oversupply evens domestic prices

Germany's recent refined products oversupply, particularly in the south, is waning because of higher demand and technical issues reducing availability. Price differences within the country are starting to level out.

Availability of heating oil and road fuels at the Bayernoil consortium's 215,000 b/d Vohburg-Neustadt refinery in Bavaria is restricted. At least one of the refinery's stakeholders is restricting loadings of E5 and 98 Ron gasoline and will probably continue to do so until the end of July. Planned maintenance works on a reformer have reduced production.

Diesel and heating oil availability for spot sale are also restricted. A unit outage is affecting the refinery's diesel throughput, and a damaged heating oil tank at Vohburg has restricted loading capabilities since June.

Term contracts are unaffected.

Demand has increased across the board because of lower domestic prices, after Ice gasoil futures dropped week-on-week. Traded heating oil volumes reported to Argus last week rose especially strongly, by 28pc, and fuel demand also went up.

By Natalie Mueller