US Products Outlook-Quiet and rangebound

NEW YORK Nov 16 (Reuters) - Warmer-than-normal weather combined with high inventories will keep distillate stocks virtually undisturbed while gasoline prices have started to gain as refiners continue to trim runs to keep margins in the black[ID:nN16399494], traders said on Monday.

At present, arb opportunities for gasoline into the New York Harbor are weak as the European cash market has moved into backwardation and the November/December spread holds at par.

Exports appear profitable on paper but traders said only one cargo of Eurograde is seen on offer by the end of the month as stocks in both regions remain high.

Gulf Coast gasoline inched up but Midwestern gasoline was expected to be quiet after last week's volatile ride.

Lack of heating demand on both sides of the Atlantic are keeping the distillate market in neutral [ID:nN16386127], with demand in Germany falling over 40 percent in October from last year.

Talk of a few distillate cargoes leaving from the U.S. Gulf into Europe are limited to some system cargoes, traders said, but served to put a floor under the free fall of 61-grade ultra-low sulfur in the region. [ID:nN10317568]

Group Three ultra-low sulfur diesel is likely to move up slightly this week on some harvest buying, but ample supplies and the end of the harvest season will likely keep a lid on prices, traders said.

"It's too late in the season for it to go too crazy," one broker said.

Although Magallen stocks of the fuel have dropped to 5.25 million barrels from 6 million barrels, they are still well above levels of around 3.5 million barrels year ago, the broker said.

Weather may continue to distrupt corn and soybean harvest this week, but will be favorable for planting and developing winter wheat in parts of the Midwest, according to DTN Meteorlogix.[ID:nDTN850]