European governments ramp up emergency oil stocks
GENEVA/AMSTERDAM (Reuters) - European governments are rushing to boost stockpiles of crude oil and fuel, three agencies in control of strategic reserves said on Friday, anxious to comply with new EU rules and ahead of feared supply disruptions in the Middle East.
Belgium and the Netherlands have issued tenders to import a total of around 250,000 tonnes of diesel and gasoline for delivery in September and October, their agencies said.
France has also bought diesel and awarded a crude oil tender this week while Belgium is increasing its crude stocks.
The tenders are likely to support high fuel prices and could also help buoy Brent crude futures, already up nearly $10 since the start of August on Middle East tensions and limited North Sea supplies, analysts said.
"This is yet another unexpected source of support for oil demand...It's a mirror of the stockpiling we saw in China earlier in the year, and shows how the geopolitical concerns about Iran and Syria are bullish for oil even in the absence of an actual supply disruption," said Seth Kleinman, head of energy research at Citi.
State inventories have come into focus as speculation mounts that the United States and other Western governments may release stocks to dampen prices and prevent high energy costs from undermining sanctions against Iran.
An EU directive passed in 2009 and designed to mitigate the impact of a supply crisis requires EU members to hold reserves equal to 90 days of average daily net imports or 61 days of average daily consumption ahead of a December 31 deadline.
One third of the stocks must be held in products, according to the EU directive.
"We are in the process of building stocks to meet our strategic obligations under the new EU rules," said Alain Demot, general manager of Belgium's Apetra, adding that more tenders would be issued in coming months.
Apetra said its tender was for 57,000 tonnes of diesel and was awarded on Thursday. It also said it had issued a crude oil tender and that a cargo of 900,000 barrels of crude oil would be delivered before the end of August into Belgian storage held in Wilhelmshaven, Germany.
Dutch agency COVA said it had issued a tender to import 200,000 tonnes of gasoline and had awarded a portion of the volume.
France's SAGESS said it bought 2 million barrels of diesel or 267,000 tonnes before the end of June to meet its EU requirements. It awarded a tender to buy 2.1 million barrels of Saharan Blend crude for September delivery earlier this week.
(Writing and reporting by Simon Falush and Emma Farge; additional reporting by Michel Rose in Paris and Jessica Donati in London; Editing by Jane Baird and David Cowell)
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