Gulf Coast Gasoline Stronger as Valero Shuts Texas Refinery Unit

Gulf Coast gasoline strengthened after Valero Energy Corp. (VLO) shut a sulfur recovery unit for maintenance at the Port Arthur refinery in Texas.

The unit and a tail gas incinerator will undergo planned repairs, Bill Day, a Valero spokesman, said in an e-mailed statement.

“The work isn’t having a material impact on production at the plant,” he said.

The discount for conventional, 87-octane gasoline in the Gulf Coast narrowed 1.2 cents to 9.6 cents a gallon versus futures traded on the New York Mercantile Exchange at 1:54 p.m., according to data compiled by Bloomberg. It’s the highest level since June 15. Prompt delivery rose 5.73 cents to $2.6873 a gallon.

New York conventional gasoline strengthened for a second day after production of the grade by regional refiners declined, falling 13,000 barrels on a four-week average to 1.74 million barrels a day, the Energy Department reported July 25. It was the lowest level for the period since May.

The discount for conventional, 87-octane gasoline in New York Harbor narrowed 1 cent to 13 cents a gallon versus futures.

Production of reformulated fuel by refiners and blenders on the East Coast rose 5,000 barrels to 1.22 million barrels a day on a four-week average basis, government data showed.

The premium for reformulated, 87-octane gasoline, or RBOB, in New York narrowed 2.25 cents to 1.88 cents a gallon.

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

To contact the editor responsible for this story: Bill Banker at bbanker@bloomberg.net