French strikes impact deepens: Update
OREANDA-NEWS. French strike action has spread to ExxonMobil's 233,000 b/d Port Jerome and 117,000 b/d Fos refineries, but production remains unaffected. All five of Total's French refineries — totalling 820,000 b/d of production — are significantly impacted.
Total's 105,000 b/d Feyzin and 240,000 b/d Gonfreville refineries have been fully shut down following strikes surrounding the planned government introduction of French labour reforms. The 222,000 b/d Donges plant is partially shut down and operating rates have been reduced at the 160,000 b/d La Mede facility. All units at the 93,000 b/d Grandpuits refinery will be forced to close, but exact timing remains unclear. There are blockades at Total's storage facilities at Dunkirk and Valenciennes in northern France, but its seven other depots are operational.
A "limited" number of workers are striking at ExxonMobil's Fos and Port Jerome plants, but overall output is unaffected at the facilities, according to ExxonMobil. Supplies at Port Jerome are unaffected, but there is an "internal blockade" at the Fos terminal by a number of workers, ExxonMobil said. Ship tracking data suggest delays to crude unloading at Fos.
Petroineos is carrying out planned maintenance on a crude unit at its 210,000 b/d Lavera plant, but the affiliated steam cracker remains operational. The crude unit maintenance is due to run from early May until mid-June.
The transportation of oil products via pipelines in France is also being impacted. No jet fuel, diesel or gasoline is entering the NATO Central Europe Pipeline System (CEPS) from Le Havre and Lavera.
CEPS is a military capability of the NATO alliance designed for jet-fuel transport and storage for NATO customer nations, as well as for non-military commercial purposes. The pipeline typically takes in 17,000 b/d of oil products from Marseille and around 26,000-34,000 b/d from Le Havre.
Both locations account for 20-25pc of the total oil products carried within the pipeline network. The reduced flow has not yet caused the pipelines' customers to use alternative means to source product, but discussions on contingency measures are currently taking place should the disruptions persist.
Europe's freight market has so far been largely unaffected by the French strikes, although brokers warned that rates will likely push higher if the disruption continues to the end of the week. Around 6-8 Aframax vessels are waiting to discharge across the whole of France, and there is a reluctance from charterers to book vessels due to call at French ports. This is being mitigated by a firm supply of available tonnage in the remainder of the region, with charterers instead looking at vessels due to call at Rotterdam or elsewhere.
The strike action began last week and has led to fuel shortages in many areas in France. Local authorities have already enforced limits on the amount available to individual users. Several unions are involved in the action across France, including the CGT and Force Ouvriere.
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