Germany's oil products market turned volatile on 2 March after Ice gasoil futures jumped in the wake of US-Israeli strikes on Iran at the weekend.
Suppliers lifted offers for middle distillates and gasoline by up to €16/100 litres on the morning of 2 March compared with 27 February, traders said.
Ice gasoil futures briefly pushed above $900/t on 2 March, from $752.75/t at the 27 February settlement, after co-ordinated strikes by the US and Israel on Iran on 28 February prompted Tehran to retaliate with missile and drone attacks across the Mideast Gulf.
German supply has not been directly affected, but vessels have been advised by the IMO's secretary-general to avoid the strait of Hormuz, which could tighten European diesel supply and increase competition for available imports.
Buying picked up in Germany on 2 March as customers moved to lock in volumes amid rising prices, traders said. Heating oil demand, in particular, rose strongly after subdued purchases the previous week.
Distillate prices had already climbed in the prior week on the risk of conflict breaking out in the Middle East, discouraging consumer buying. Traders reported around 20pc fewer heating oil volumes traded in the week to 1 March than the previous week, citing rising prices and milder weather. Diesel trades rose by about 10pc as the agricultural sector began field work.
Meanwhile, Germany's refinery maintenance season is under way. Gunvor's 100,000 b/d Ingolstadt refinery in Bavaria went offline for scheduled works in the past week. It joins the Bayernoil consortium's 207,000 b/d Vohburg–Neustadt complex, also in Bavaria, where the Neustadt section was taken offline on 14 February.
By Natalie Müller
