Northwest European Gasoline Margins Surge to Four-Year High on U.S. Inventory Draw

Northwest European gasoline refining margins surged to a four-year high on Wednesday, climbing by approximately $4 to reach $43.69 per barrel. The sharp increase in refinery profitability was fueled by a significant drop in U.S. inventories and lower crude oil prices.

U.S. Stockpiles Fuel Rally

The primary catalyst for the rally was a bullish report from the U.S. Energy Information Administration (EIA). The data revealed that U.S. gasoline inventories fell by 1.5 million barrels last week to a total of 210.5 million barrels.

This drawdown was nearly double the 760,000-barrel decline that analysts had forecast in a poll. A larger-than-expected inventory drop in the world's largest fuel market often signals robust demand or tighter supply, providing strong support for gasoline prices and refining margins.

European Market Activity

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Trading in the European physical market was active, with several major energy firms participating. Key transactions included:

• Eurobob E5: A total of 4,000 metric tons of barges were traded on the Argus platform, with Aramco and ExxonMobil selling to Gunvor.
• Eurobob E10: An additional 4,000 tons were traded, with Phillips 66 selling to ExxonMobil.

Separately, ExxonMobil sold a Eurobob E5 barge to Sahara through the Platts trading window, according to market data.