European diesel refining margins declined more than 7% on Monday as the gasoil-Brent spread narrowed by $5.52 to $70.79 per barrel at 1:12 PM London time.
The drop in margins followed a reduction in the premium for low-sulfur gasoil futures relative to Brent crude, reflecting softer refining profitability in the region. Data from Kpler showed that diesel and gasoil imports by the 27 EU countries and the United Kingdom are projected to average 724,000 barrels per day in August, up from 466,000 bpd in July.
Imports from the United States accounted for more than half of the total August volume, with 446,000 bpd shipped to Europe. The increase in imports coincides with operational disruptions at a major Russian refinery. A Ukrainian drone strike on August 21 targeted the Perm oil refinery, Russia’s seventh-largest by processing capacity, halting operations at the facility.
In European trading, BP sold a cargo of ultra-low sulfur diesel for delivery to Gdynia, Poland, during the afternoon session. No cargo changed hands in the Mediterranean trading window, though TotalEnergies was the only company to submit a bid.
