Gasoline market snowballs as Europe and Asia bear the brunt of the Nigerian oil fiasco   

11 feb 2022: The Gasoline market has skyrocket and reached its highest since 2019 in Europe and Asia particularly. This comes after Nigeria received fuel shipments that were unfit for domestic consumption because of their elevated methanol content and hence require and urgent re-supply.

The road fuel’s premium to crude -- a key metric followed by traders soared in northwest Europe and Asia, according to Bloomberg. US has also witnessed a hike, where supply had already taken a hit owing to the halts at several refineries.

The traders in Europe and Asia are not happy with this development since Nigeria’s need for imports was supporting gasoline margins in these regions. According to a Reuters report, the country has an urgent need for about 500,000 metric tons of fuel, which adds unto about 16% of the world’s daily demand for the fuel. This as you can imagine would definitely not be easy to source on such short notice.

The Gasoline margins have already been on the higher side these past few weeks owing to the unplanned refinery outages in both the U.S. Gulf coast and Europe. Europe crack spreads over crude reached $14.99 a barrel on Wednesday, up from $9.31 at the start of the year.

Stockpiles in the U.S. are significantly below the five-year average and globally the demand is expected to increase to 99% of the 2019 level this year, according to the International Energy Agency.

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