October Pricing Analysis - European Jet

Summary

Jet Fuel NWE CIF Cargoes averaged $1,611.47/mt in October, up 3.69% on September's $1,554.05/mt (+122.7% YoY). The month ended almost where it started: $1,592.00/mt open, $1,595.50/mt close. The story was rebalancing within the middle distillate barrel. In September, diesel led the complex. In October, diesel-specific supply relief weakened ULSD and LSGO paper while jet held firm. The Regrade averaged +$6.33/bbl against -$4.24/bbl in September, and the Jet vs LSGO diff nearly doubled to +$168.72/mt. GX's CIF assessed-vs-implied diff peaked at +$55.17/mt on 14 October and the jet half-daily structure deepened, both pointing to physical cargoes running ahead of paper. Barges traded over cargoes as local refining supply tightened. Diesel strength returned in the final fortnight and the jet premium faded into the close. The setup for November rests on whether the physical premium holds once the next LSGO roll is through.

Price trends

Jet CIF NWE rose 3.69% MoM on a narrower range; W3 and W4 marked the high plateau before a late-month fade

• Jet CIF NWE opened at $1,592.00/mt and closed at $1,595.50/mt. The monthly average of $1,611.47/mt compares with September's $1,554.05/mt (+3.69% MoM) and October 2025's $723.60/mt (+122.7% YoY).
• The monthly high was $1,686.00/mt (8 Oct) and the low $1,500.75/mt (2 Oct). The intra-month range of $185.25/mt was 0.63x September's $292.50/mt.
• The largest single-day fall was -$91.25/mt on 2 Oct, when a coordinated G7 stock release front-loaded diesel. LSGO M1 fell $96.00/mt the same day, so the move was complex-wide rather than jet-specific.
• The largest single-day rise was +$105.25/mt on 7 Oct, the same day the Regrade hit its monthly high.
• W5 fell 2.16% WoW as diesel firmed and the jet premium to LSGO compressed.

Cross-commodity dynamics

The Regrade flipped to +$6.33/bbl as diesel relief weighed on ULSD and LSGO but not on jet

• The Regrade averaged +$6.33/bbl against -$4.24/bbl in September, peaking at +$12.78/bbl on 7 Oct. Supply relief was diesel-specific: the G7 release (2 Oct) and a US licence for Russian diesel transactions (9 Oct) offered jet no equivalent.
• The Jet vs LSGO diff averaged +$168.72/mt against +$88.77/mt in September and peaked at +$222.25/mt on 14 Oct. Jet outperformed the underlying futures as gasoil paper absorbed the diesel news.
• CIF assessed vs implied (GX internal) reached +$55.17/mt on 14 Oct and averaged +$27.01/mt against -$2.06/mt in September. Physical cargoes held firm while paper fell.
• Barges traded over cargoes. The CIF vs FOB Barges spread averaged -$9.50/mt (September +$6.88/mt) and closed at -$18.25/mt. A planned unit shutdown at Shell's Rotterdam refinery from 28 Sep reduced local refining supply on the barge leg.
• The jet premium faded late month. The Regrade closed at -$1.14/bbl, the Jet vs LSGO diff hit a monthly low of +$116.25/mt on 30 Oct, and the crack closed at $84.62/bbl against a $96.19/bbl average.

Market activity

Trades rose almost fivefold to 131, concentrated in paper diffs, with an integrated major leading the buy side

• There were 396 bids against 201 offers (ratio 1.97 vs 1.72 in September). Trades rose to 131 from 27, with 119 on the jet paper diff codes.
• BP Oil International placed 143 bids and took 49 trades as buyer, up from 76 and 13 in September. This fits the module's coverage-buying pattern for airline-linked majors.
• Unipec Singapore, the trading arm of an Asian refiner, was the top seller with 40 trades and 38 offers (13 offers in September). That is East-of-Suez export flow clearing into NWE, consistent with the widening NWE-Singapore spread.
• Gunvor traded both sides (35 buy, 34 sell), which reads as intermediary positioning rather than directional flow.
• Xconnect Market Maker entered on both sides (52 bids, 47 offers), adding two-way liquidity in a month when CV fell to a six-month low.
• TOTSA was in the September top eight on both sides but absent from October's.

Cross-regional dynamics

The NWE premium to Singapore widened to +$268/mt as the East-West arb pulled Asian barrels west

• NWE CIF minus Singapore FOB averaged +$233.09/mt against +$218.25/mt in September and closed at +$268.16/mt.
• NWE CIF minus USGC Jet 54 averaged +$10.76/bbl against +$5.85/bbl. The Transatlantic arb sits only at the freight threshold.
• Both tests for a cross-regional read are met: the spread sits far outside normal range, and the flow change shows in the MOC through Unipec's sell-side volume.

Curve structure

Near-parallel LSGO rally with a mid-month front-spread dip; jet prompt structure steepened against paper

• Nov26 rose $81.75/mt and Oct27 rose $86.75/mt. This was a near-parallel shift, so no named pattern applies.
• The front spread compressed and then rebuilt. Nov/Dec fell to +$37.25/mt on 12 Oct on diesel relief, then widened to +$66.75/mt by 30 Oct as diesel tightness returned.
• The jet half-daily structure (GX internal) deepened from -$1.66/mt on 9 Oct to -$2.98/mt on 14 Oct and averaged -$2.63/mt against -$1.49/mt in September. This prompt backwardation in jet ran alongside the physical premium to paper.

Price volatility

October CV of 3.11% was the lowest in six months

• CV fell to roughly a quarter of the July peak of 11.70% as the range narrowed to $185.25/mt.
• Position sizing calibrated to the Jun-Jul regime of 10-12% now overstates flat-price risk. The diff and Regrade moves carry the risk instead.

Something to watch

• CIF assessed vs implied as the physical-strength gauge:
  • Observation: the diff closed at +$15.51/mt (30 Oct), down from +$55.17/mt on 14 Oct.
  • Why it matters: a slide toward zero would confirm that the October jet premium has unwound and the Regrade stays negative. A rebound above +$40/mt would signal renewed cargo tightness.
  • What to monitor: the daily diff; Insights Global ARA jet stocks each Thursday.
• LSGO Nov/Dec into the 12 November expiry:
  • Observation: the spread stood at +$66.75/mt on 30 Oct, rebuilt from +$37.25/mt.
  • Why it matters: holding the backwardation through the roll confirms that diesel leadership has returned, capping the Regrade.
  • What to monitor: daily GX LSGO M1-M2 close.
• Cargo-barge spread as the local supply gauge:
  • Observation: the spread closed at -$18.25/mt.
  • Why it matters: a return above zero would signal local refining supply restored and the barge premium unwinding.
  • What to monitor: the daily CIF vs FOB Barges close; restart timing at Shell Rotterdam.

Note: All figures, prices and market activity referenced in this report are based on the period 1 to 30 October 2026.