European gasoil supplies remained tight in October 2026 as disruption to inland waterways restricted deliveries despite refiners’ efforts to increase middle distillate output, according to Alkagesta Media. Its market outlook, published on 21 October, described volatile prices across Northwest Europe and the Mediterranean, with depleted inventories helping to sustain physical gasoil prices relative to front-month ICE Low Sulfur Gasoil futures.
The report identified exceptionally low Rhine water levels as a major obstacle to replenishing supplies in Germany and Switzerland. Readings at Kaub fell to 1–2 cm on 6 and 8 October before subsequently ranging around 7–18 cm. Alkagesta said the restrictions prevented barges from loading normally, leaving inland distributors dependent on more expensive rail and pipeline transport. Wholesale buyers and end-users were purchasing only what they immediately needed rather than securing large volumes.
Those delivery pressures were reflected in heating oil prices. Physical barge differentials for 50 parts-per-million gasoil, used for heating in Germany and Switzerland, moved from a discount of $26.75 a tonne to front-month futures in early October to a premium of $10.75 by mid-month. Alkagesta put ARA gasoil and diesel stocks at 1.664 million tonnes, down 21% from a year earlier. Middle distillate inventories were separately reported at 2.255 million tonnes, 20% below their five-year average.
Seaborne supply was also facing higher transport costs. According to the outlook, Arab Gulf-to-UK/Continent LR1 freight averaged $156.01 a tonne in September and reached $220.77 on 19 October, compared with $46.41 a year earlier. Clean-product volumes transported on LR2 tankers fell 28% year on year to 2.1 million barrels a day over the first nine months of 2026. Low European stocks and middle distillate shortages east of Suez drew US Gulf Coast gasoil cargoes towards Northwest Europe and Mediterranean ports, supporting MR1 tanker employment.
Alkagesta expects planned secondary refinery maintenance, limited stock buffers and continuing inland transport constraints to support middle distillate prices. It also anticipates that postponed residential heating oil purchases could concentrate demand as temperatures fall. Sustained rainfall would be needed to ease Rhine restrictions, the outlook said. These projections reflect Alkagesta’s assessments rather than assured outcomes; the publisher notes that actual market developments may differ from its expectations.
Read the original announcement on Alkagesta.