Gulf Gasoline Rises as Weather-Related Refinery Outages Persist

Spot gasoline in the Gulf Coast rose as Western Refining Inc. and Valero Energy Corp. plants reported shutdowns and rate reductions that added to supply disruptions caused by a winter storm in Texas.

Power outages from the storm caused Western to shut all hydrogen consuming and producing plants at its El Paso, Texas, refinery yesterday, according to a company filing with the Texas Commission on Environmental Quality.

Valero reduced rates at its McKee refinery in Texas after issues with crude supply from a pipeline, Bill Day, a company spokesman, said in an e-mail.

The discount for Gulf Coast conventional, 87-octane gasoline narrowed 0.25 cent to 7.5 cents a gallon versus futures traded on the New York Mercantile Exchange in New York at 4:06 p.m., according to data compiled by Bloomberg. Prompt delivery rose 0.74 cent to $2.4284 a gallon.

The same gasoline in the Midwest, or Group 3, strengthened 0.25 cent to a discount of 3 cents a gallon.

The Explorer Pipeline Co. started its oil products line today after shutting down yesterday at the request of the power company, Tom Jensen, a spokesman for the company, said in a telephone message. “We should be able to make up that down time with a little faster rate,” he said.

The McKee refinery, which can process 170,000 barrels a day, obtains oil from storage in Cushing, Oklahoma, through third-party pipelines, according to the Valero website.

“We don’t have an estimate, but we expect the reduced rates to be temporary,” Day said.

To contact the reporter on this story: Paul Burkhardt in New York at pburkhardt@bloomberg.net.

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net.

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