European jet: Prices rise as French strikes intensify

Outright European jet prices rose on Friday as French trade unions said most of the country's refineries would be offline by Monday.

The underlying Ice gasoil contract rose to $775.50/t on Friday, up by $25.25/t from the previous close.

Northwest European jet fuel prices fell to a $29.20/t discount to Singapore on Thursday, marking the first inversion of that price relationship since November 2021.

European jet fuel prices dived this week as a result of a steep sell-off in Ice Brent crude and gasoil futures, likely resulting from concerns around the global financial outlook after the failure of two US banks. Europe now finds itself oversupplied with jet fuel as demand still lags behind pre-pandemic level and refiners shifted yield towards jet fuel in February as diesel values slumped, according to market participants.

There was a surge in air passenger numbers traveling to and from China after the Chinese government removed several travel restriction on 26 December 2022 and reopened its border to international travel on 8 January, according to the International Air Transport Association (Iata).

The Chinese New Year on 22 January gave additional impetus to air travel demand.

There were no jet fuel cargo trades reported in northwest Europe on Friday. Glencore offered four cargoes, two of them priced against spot quotes, at a $9/t and a $10/t premium, both for Rotterdam delivery. The other two were priced against Ice April gasoil futures, one at a $13/t premium, the other at a $16/t premium, both for Rotterdam delivery. BP made an offer at a $4/t premium to spot prices for Rotterdam delivery. Saudi Aramco also offered at parity to spot prices for Rotterdam delivery. Unipec placed two bids both for Rotterdam delivery, one at a $10/t discount to spot prices, the other at parity to Ice April gasoil futures. Jet fuel cargoes in northwest Europe were assessed at a $12.50/t premium to the Ice April gasoil contract, lower by $3/t from the previous session, reflecting the lowest unmet offer value.

No trades and offers were reported in the fob FARAG barge market. Shell bid at a $2/t discount to spot prices. Jet fuel barges were assessed at a $9.50/t premium to the April gasoil contract, maintaining their $3/t discount to cargoes.