French oil refinery strikes to tighten gas oil supplies

"At least 900 000 bpd of France's 1.15 million bpd 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 119 000 bpd Feyzin refinery in Courbevoie, France was running at half capacity.

Previously, the EU's embargo on Russian oil products came into effect on 5 February 2023.

Ahead of the sanctions, European gas oil (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.

Gas oil 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 2023." 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 gas oil. The strikes were staged in protest to an increase in the retirement age in France.

Stevenson said Exxon Mobil Corp.'s 191 000 bpd Esso refinery in Rotterdam, the Netherlands, is undergoing a plant-wide 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 gas oil has remained stable, Stevenson noted.

However, she said, gas oil supplies in Europe are about to get very tight due to the refinery strike in France and the planned refinery outage in the Netherlands.

Read the article online at: https://www.hydrocarbonengineering.com/refining/03042023/french-oil-refinery-strikes-to-tighten-gas-oil-supplies/