European diesel refining margins jumped more than 10% as the International Energy Agency and the European Union discussed releasing strategic oil stocks. France plans to release 10 million barrels of diesel from its reserves, with Prime Minister Sebastien Lecornu set to announce the move Wednesday evening, while G7 countries have also moved to tap stocks as refinery capacity stays squeezed by the war in Ukraine and the Middle East.
Margins jump as stock release talks advance
European diesel refining margins rose more than 10% on Wednesday as the IEA and the EU discussed a coordinated release of strategic oil stocks. Low-sulphur gasoil futures traded at $75.23 a barrel above Brent crude futures at 1725 GMT, a premium that was $7.08 higher than the previous close.
The release was proposed last week, and diplomats and analysts expect it to include volumes that were pledged in March as part of emergency supply measures.
France readies a 10-million-barrel release
France plans to release 10 million barrels of diesel from its strategic stocks, Franceinfo radio reported, citing unnamed sources. Lecornu was scheduled to formally announce the release during a national address on Wednesday evening.
The move follows a broader push among allies. G7 countries led by France, facing pressure from the Trump administration, agreed Friday to release diesel stocks, though the quantities involved remain unclear. According to CNBC: "They're pulling every lever they can", Jeff Currie, CEO of Real Macro, said.
Refineries, not demand, are the bottleneck
Sources: Investing.com, CNBC
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