Constraints on government budgets for road projects are helping to keep a lid on bitumen margins in Europe, exacerbated by strong crude and fuel oil prices, plentiful supply in the Mediterranean, and a closed arbitrage to key export outlets.
Work on road and highway projects in Europe is being restricted this year by high rates of inflation and budget deficits, both knock-on effects of the pandemic and the war in Ukraine. Demand in France and Germany has declined sharply this year, while consumption in the UK, Romania, and Italy has failed to rebound from last year’s steep fall.
European bitumen demand tends to take a dip in the peak summer holiday season from late July through August before recovering in September. But this year’s summer lull was especially pronounced and the autumn rebound has been slow to materialise so far.
