Global refined product markets are very well supplied at the moment, as evidenced by the steep spot price falls seen for diesel, jet fuel and gasoline over the last few weeks.
Partly, this is the result of the huge drop in crude oil prices witnessed since the summer of 2014, which has incentivized refiners to run as hard as they can.
We are also no doubt still witnessing the effect of the large investments in new refinery capacity undertaken several years ago in Russia, the Middle East and Asia.
But, even as Europe is swimming in oil products, it was revealed Oct 27 that one country, Switzerland, has had to dip into its emergency stocks of diesel and gasoline to guarantee supplies.
The situation may have struck some as ironic given that the country is home to the majority of Europe's oil traders and suppliers, including well-known industry names such as Gunvor, Mercuria, Total and Vitol.
But in Switzerland's case, supply shortages are real after the country's last operating refinery, Cressier, was forced to close for unplanned maintenance last week, and because of low water levels.
Tamoil closed its Collombey plant in the country earlier this year, leaving Switzerland with just one refinery.
It's easy to forget it if, like me, you live in the UK, but Continental Europe has had a hot, dry summer, and water levels on the Rhine have been below normal since July. For Switzerland, which is landlocked and tends to be supplied largely (albeit not only) by barge, this has made resupply more problematic.
For European governments safe in the idea that oil prices have fallen in the past 18 months, this latest episode is a painful reminder that a lot of European refinery capacity has closed over the last few years.
With fewer refineries in operation, Europe will in the future be more open to internal and external supply shocks, as well as to the vagaries of Mother Nature.
European summers will likely get hotter and drier into the future because of climate change, making situations like today's on the Rhine only more common, and exposing Switzerland to long periods when the most realistic supply option is by pipeline from France, train from Germany, or, indeed, by its last standing refinery in Cressier.
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