Alkagesta has published its European gasoil market outlook for July 2026, describing a market navigating an acute supply-side crisis defined by steep backwardation and extreme prompt physical scarcity across Northwest Europe and the Mediterranean.
The central constraint identified by Alkagesta is logistical. Water levels at the Rhine's Kaub choke point fell from 72 cm on 10 July to 32 cm by 27 July, with forecasts pointing toward a record low near 25 cm that would effectively end navigation on the Upper Rhine. At those levels barge loading capacity had already been cut to 16.6%, pushing volumes onto more expensive road and rail alternatives.
Inventory cover offered no offset. Diesel and gasoil stocks in the Amsterdam-Rotterdam-Antwerp hub fell to 1.636 million mt in the week ended 24 July, the lowest level recorded since August 2022. Alkagesta notes that local demand and export requirements were outstripping available supply at precisely the moment inland distribution seized up.
Mediterranean balances were equally tight. Alkagesta describes the 0.1% gasoil market in the basin as 'very tight', supported by North African demand from Libya, Algeria and Tunisia for both road transport and summer power generation.
Prices moved accordingly. Alkagesta cites Platts assessments showing 50 ppm gasoil FOB ARA barges rising from $990.00/mt on 10 July to $1,065.25/mt on 13 July and peaking at $1,281.75/mt on 23 July — the highest since early April — before easing to $1,221.25/mt. Mediterranean 0.1% CIF cargoes followed a similar path, peaking at $1,300.25/mt on 23 July.
Trade flows have reorganised around the deficit. Alkagesta reports Turkey diversifying its import slate with 140,000 mt of Indian gasoil and 83,400 mt from Red Sea ports in July, alongside expected receipts of 129,600 mt from Italy and 92,900 mt from Greece. In West Africa, small clips of 50 ppm gasoil at Offshore Lome were valued at an $80/mt premium to front-month ICE low-sulphur gasoil futures.
Alkagesta's outlook remains bullish into August, citing persistent Rhine constraints, depleted ARA inventories, the late-August transition to winter-grade heating oil specifications and continued Hormuz-related disruption. On that view, the supply environment is unlikely to ease materially before the winter heating cycle begins.
The company notes that its analysis draws on internal assessments alongside publicly available information, including pricing data published by S&P Global Platts.
