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Low Rhine Water Levels, Heat Strain German Fuel Logistics, Kpler Says

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Low Rhine water levels and a heatwave are increasing pressure on Germany's oil logistics network, supporting higher barge freight rates and inland diesel prices, Kpler said in a Friday note.

Barges carrying diesel, gasoil and gasoline could load only about half their normal capacity as water levels at Kaub, a key Rhine shipping chokepoint, are forecast to drop below 100 centimeters in the coming days.

Freight rates for barges operating in the Amsterdam-Rotterdam-Antwerp region have climbed to their highest level since July 2025, while shipping costs into Basel, Switzerland, have increased because more vessels are required to transport the same cargo volumes.

Since April, water levels at Kaub have remained below the five-year average and are close to the levels recorded in 2022, when prolonged summer heat severely disrupted navigation along the Rhine.

Germany is moving more oil products onto its rail network as Rhine water levels decline, but constrained rail capacity, longer booking lead times, diversion staffing needs and heat-related speed limits are making fuel distribution less flexible.

Longer rail journey times continue to add pressure as Germany upgrades its rail network through the mid-2030s, despite the reopening of the Hamburg-Berlin corridor in mid-June 2026 following a 10-month closure.

Oil product shipments on the Rhine declined 6.2% over the year in the first half of 2025, the Central Commission for the Navigation of the Rhine said.

It noted that Germany had almost 4% less diesel at 14.3 million metric tons, with Belgium and the Netherlands accounting for over 70% of supplies, including pipeline volumes.

Restricted barge access is complicating product movements from the MiRO refinery in Karlsruhe and Shell's Godorf refinery near Cologne, forcing additional fuel volumes onto an already constrained rail system.

Refiners are using limited barge capacity to move niche products with few storage or transport alternatives, leaving more widely traded fuels to compete for scarce rail capacity, while elevated temperatures also reduce refinery efficiency and output, Kpler said.

Germany could see stronger road fuel demand before June 30 as motorists bring forward gasoline and diesel purchases ahead of the expiration of the country's temporary fuel tax reduction, according to Kpler.

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