Trouble in the Rhineland
 

In Europe, besides contending with an intense heatwave, lower rainfall has impacted inland waterway transport on the Rhine River. This serves as an important means of regional fuel distribution, given the lack of an extensive and well developed pipeline network. Instead it takes the form of barge transport carrying petroleum products from the ARA trading and storage hub to inland markets in countries such as Germany and Switzerland.

 

Low rainfall since mid May has put pressure on this network and low water levels at the Kaub choke point have resulted in draft restrictions and reduced the cargo quantity barges can carry. Although this is not unusual for the time of year and fresh rain is forecast, it has a knock on effect for regional product stocks and thus refining margins. With this in mind and the potential for greater variation in average seasonal rainfall patterns due to climate change, such disruption is likely to become more common.

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