European refining margins soar in 1Q: Total

OREANDA-NEWS. April 16, 2015. Total's European refining margin indicator (ERMI) rose to \\$47.10/t (\\$6.41/bl) in the first quarter, a sevenfold increase from a year earlier and over 70pc higher than the previous quarter.

It represents the highest level since the third quarter of 2012.

Margins in Europe were supported in the quarter by lower crude prices and improving demand. "European product demand, long in secular decline, swung back to growth in some markets in early 2015," the IEA said today in its latest Oil Market Report. Cold weather and lower retail product prices helped spur the demand growth, it said.

European refineries also benefited in the quarter from shutdowns and weaker crude runs in many non-OECD countries, according to the IEA. "The region's refining sector has found renewed vigour amid weaker-than-expected runs elsewhere," it said.

Total's indicator represents the margin after variable costs for a hypothetical refinery near Rotterdam, processing crude and other feedstocks commonly supplied to northwest Europe to produce the main refined products at prevailing prices in the region. It does not represent the actual refining margins achieved by Total.