​October US Diesel Shipments to Europe Tracked at 2014 Low

Monthly U.S. exports of ultra-low sulfur diesel to north west Europe are set to plunge to the lowest level of 2014 during October, as it remains unprofitable to buy and ship the middle distillate to the continent from north America for more than six weeks.

Some 506,000 metric tons (nearly 3.8 million barrels) are tracked on 11 tankers arriving in ports in Europe and the U.K. in October, according to the OPIS Tanker Tracker on FleetMon.com.

The tracker compiles information from brokers, traders and ship-tracking data and assumes that cargoes loading clean petroleum product or diesel are ULSD shipments. Not all shipments are reported to the market.

Volumes being shipped over the Atlantic for the 15-day voyage have fallen in the past two months, after averaging 1.5 million tons in the first six months of 2014, the latest available European Commission trading data. The arbitrage has been closed for nearly two months, with the delivered cost of ULSD shipped from the U.S. to Europe about $15 per ton more expensive than the region's spot price, OPIS data show.

Some 1.1 million metric tons was exported to Europe from the U.S. last month, while OPIS Tanker Tracker third-quarter volumes on the route are tallied at 4.2 million tons, indicating how unusually low October volumes are trending.

Traders have told OPIS that the closed US-Europe arbitrage amid slowing demand growth and higher imports from Russia is likely to cut back U.S. ULSD shipments to around 900,000 tons for the remaining months of 2014.

The OPIS Tanker Tracker compiles information from traders and brokers, and FleetMon ship tracking to provide a real-time insight into Europe-bound refined products on tankers. Pinpoint detailed shipping information, such as vessel, product and volume being transported, and buying or selling party and gain critical intelligence on the movement of product from port to port. Learn more and take advantage of a 21-day, no-obligation free trial.

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