Light-ends markets look well-supplied as we enter 2025

Commentary summary:

– Contango strengthens across the Atlantic Basin, with Sg92 spreads also softening but remaining in backwardation, as winter stockbuilds kick in.

– A reversal of the short naphtha rally leading into the New Year has helped to bring gasoline down in this first full trading week.

– E/W widens further in the first sessions of the year, despite weaker European spreads, in a move which just about edges out further moves from Europe to East Africa and beyond.

– January in particular still sees Europe supplying al swing destinations across the Atlantic, with some very prompt TA opportunities also available, all supported by continued weak TC2 rates

– Reformate premia are holding up globally, but softening component premia across other both high and lower octane components point to longer balances to start the year.

2025 has begun with some increasing signs that light ends balances globally are quite long. This isn’t particularly surprising given the time of year and it is unlikely to be spooking many people about the health of the gasoline market in general moving into the rest of the year.

Jorge Molinero is a Commodity Owner at Sparta. Starting his career as a financial analyst with BBVA, Jorge quickly transitioned to market intelligence within the energy sector, spending 4 years as a naphtha analyst with Repsol before joining Sparta in early 2023.

Sparta is a live, market intelligence and forecasting platform that enables oil traders, refiners, banks, hedge funds and wholesalers to have access to real-time and global actionable insights to capture market opportunities before others.

To find out how Sparta can allow you to make smarter trading decisions, faster, contact us for a demonstration at sales@spartacommodites.com