ARA arb out needs to be mostly closed for now

Commentary summary:

– Tightness in Europe, Asia and US continues apace with refinery outages exacerbating the supply picture. This should trump the broad closure of European arb out.

– Not much let up in bullish fundamentals data in the US with stocks providing little wiggle room and with Houston arbs dominating the Atlantic.

– Uptick in European component premiums this week has helped close off E5 blend margins despite very wide gas-nap. E10 remains open.

– Freight and narrowing Dec TA Arb are cutting off the RBOB arb too, leaving just a selection of Europe-NYH naphtha arbs open.

– Very wide gas E/W completes the closure of arb out of ARA, with the lingering bull factor now “just” WAF.

Philip Jones-Lux is Senior Analyst for Sparta. Having worked with organisations such as JBC Energy and RP Global, Philip is a seasoned energy market analyst with expertise across the oil barrel and power markets

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