Europe’s oil demand, especially road fuel consumption, has rebounded in recent weeks, as many Europeans hit the road for late-summer vacation after a year and a half of restrictions and blockages .
Air traffic in Europe is still 30% below pre-COVID levels from 2019, but demand for road fuel has strengthened this summer, according to estimates by Bloomberg shown on Monday.
Before the summer, Europe was a major drag on global oil demand with road traffic still depressed. But once the end of spring and summer arrived, Europeans from the largest economies, where consumption was the highest, hit the roads.
IHS Markit estimates that gasoline demand in Europe may have reached its highest level in August in ten years.
“August 2021 would be the best August since 2011,” Hedi Grati, executive director of IHS Markit, told Bloomberg.
“The middle ten years were all less,” Grati added.
Higher gasoline demand led to a rebound in oil demand in Europe this summer, as fuel demand in Asia began to weaken amid the resurgence of COVID cases in many major Asian economies, including the China, Japan and most of Southeast Asia.
Due to stronger European demand for road fuel, stocks of gasoline independently held at the Amsterdam-Rotterdam-Antwerp (ARA) hub fell to the lowest since 2016 in mid-August, according to data from oil industry consultancy Insights Global.
“The drop in gasoline, combined with a larger drop in fuel oil inventories, resulted in a decrease in total product inventories – the lowest total volume since March 2020,” Insights Global said.
The higher fuel demand has led to increased interest in light light crude grades among refiners in Europe, traders told Bloomberg.
Overall, gasoline traders told Bloomberg that demand for fuel in Europe this summer was equal to or even greater than during the 2019 holiday period.
By Charles Kennedy for Oil chauffage
More reads on Oil Octobers: