SUGAR LAND, Texas--(BUSINESS WIRE)--Researched by Industrial Info Resources --Oil refinery strikes in France may help unwind the stockpiling of petroleum products that took place prior to the European sanctions on Russian oil products, leading to tighter gasoil supplies.
"At least 900,000 barrels per day (BBL/d) of France's 1.15 million BBL/d refinery capacity is offline due to strike action. This has a supporting impact on refined product prices and a weakening impact on regional crude prices," said Hillary Stevenson, Senior Director, Energy Market Intelligence for Industrial Info.
Operations at all but one of the six operational oil refineries in France have been impacted by the strikes. TotalEnergies SE's (NYSE:TTE) (Courbevoie, France) 119,000-BBL/d Feyzin Refinery was running at half capacity.
Previously, the European Union's embargo on Russian oil products went into effect on February 5.
Ahead of the sanctions, European gasoil (diesel) stocks increased in preparation for the shutoff of Russian supplies, hitting a 15-month high at the beginning of the year, according to consultancy Insights Global (Breda, Netherlands).
Gasoil stocks declined last week, according to the consultancy, but stocks "remained higher year on year, as Europe is going through stocks built up before 5 February." The French strikes "remain a going concern for the market's supply..."
Strikes at French refineries have cut deeply into France's refined products output, including gasoil. The strikes were staged in protest to an increase in the retirement age in France.
Stevenson said Exxon Mobil Corporation's (NYSE:XOM) (Irving, Texas) 191,000-BBL/d Esso Refinery in Rotterdam, Netherlands, is undergoing a plantwide turnaround outage until mid-May, thus exacerbating the fuel situation in Europe.
While the prices of other oil-based commodities have declined in recent days due to banking-related market woes, the price of gasoil has remained stable, Stevenson noted.
However, she said, gasoil supplies in Europe are about to get very tight due to the refinery strike in France and the planned refinery outage in the Netherlands.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 Trillion (USD).