European refinery output drops in September

Author: 
Reuters
Publication Date: 
Sun, 2011-10-23 00:45

September's European total refinery production of 11.227 million barrels per day was a touch above the last 12-months average of 11.121 million barrels, according to Reuters' calculations based on unrevised Euroilstocks data. 
Refinery utilization rates dropped to 81.97 percent after powering ahead to a revised 84.36 percent in August as refiners moved to capture short-lived profitable margins. 
"In September and October, it is normal to have a drop in runs and then an increase from November as maintenance finishes," Credit Agricole CIB's senior oil analyst Christophe Barret said. 
September's rate was just above the last 12-month average of 81.81 percent, according to Reuters calculations, but well below last September's unrevised 85.05 percent reading as the sector continued to rein in production amid increased competition from Asia and the US. 
High Brent crude future prices at around $110 a barrel and doubts about the strength of local demand growth in the region have kept a lid on refiners' margins in this side of the Atlantic.
Output of all products fell on a monthly basis except gasoline and naphtha, which rose by 3.1 percent and 1.5 percent respectively from August to 2.700 million barrels per day and 807,000 barrels per day.
"Without question, gasoline cracks were still very healthy in the first half of September," JBC Energy's David Wech said.
"At the same time, middle distillate cracks were very poor. This might have caused respective production adjustments, particularly as it is key for European margins to avoid and oversupply in middle distillates, as is the case in the US with gasoline."
Middle distillate output fell by 3.3 percent since August to around 5.668 million barrels per day and was down 3.1 percent compared to the same time last year. 
Fuel oil production saw the biggest decline, down 8.2 percent since last month and down 6.2 percent from September last year. 
On a yearly basis, production fell across the board except
for naphtha, which saw a 13.2 jump to around 807,000 barrels per day in September. 
 

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