ICE Gasoil

ICE Gasoil is the primary exchange-traded benchmark for European distillate markets, listed on ICE Futures Europe in London. Each contract covers 100 tonnes of gasoil (broadly equivalent to diesel and heating oil), and the front-month (M1) contract is the standard hedging instrument for European refiners, fuel distributors, and airlines managing jet fuel price risk. The contract settles against the Platts CIF NWE 10ppm sulphur diesel assessment, linking it directly to physical ARA market conditions.

The prompt structure (M1, M2, M3) reflects the European distillate forward curve. Backwardation, where M1 is above M2, signals tightness in physical supply; contango, where M2 is above M1, indicates ample stock. ICE Gasoil crack spreads, the margin above Brent Crude, are the principal proxy for European refining profitability. ESMA publishes weekly MiFID II position data for the contract, covering EU-regulated firms; the CFTC does not publish an equivalent for ICE Gasoil, making ESMA the sole public positioning source for the European gasoil contract.

In the European oil markets context, ICE Gasoil has been the structural tightness indicator throughout the BP Rotterdam outage. With BP Rotterdam at approximately 200kbd (second unit offline, no restart date), EU gasoil imports at 695kbd in April (down 38% month-on-month), and ARA gasoil stocks at a fresh 2.5-year low of 13.56mb in mid-June, the crack held above $50/bbl even as flat Brent retreated. OFAC GL X (22 June) authorised Iranian crude through 21 August, driving Brent to approximately $73; EU Regulation 833/2014 bars European refiners from lifting Iranian crude, so the flat-price decline structurally widened the crack as NWE product cargoes received no equivalent relief. The first US distillate build in weeks (+3.1mb, week to 19 June) provides mild crack-narrowing pressure; the structural tailwind from consecutive US draws is now easing.

This week the ICE Gasoil crack pushed to a 2026 high, the M1 contract reasserting itself as the futures leg of a fresh supply shock: Russia banned all diesel exports through 31 July on 8 July, after Ukrainian strikes cut Russian refinery runs to multi-year lows . The move tracks the physical European diesel refining margin, which hit a record $60.17 a barrel the same day; ICE Gasoil, settling against the Platts CIF NWE diesel assessment, is the exchange-traded instrument refiners and traders use to hedge that margin forward, rather than the spot crack itself. The BP Rotterdam outage and the earlier GL X-driven widening had already kept the M1 contract in tight backwardation; the Russian ban adds a further, larger supply constraint on top of an already-thin ARA gasoil pool.