Jet Fuel Gains to Highest in Nearly a Month on Supplies

Jet fuel in New York Harbor strengthened to the highest level against futures in almost a month as inventories slumped.

Stockpiles of kerosene and jet fuel on the U.S. East Coast, the PADD 1 region, slipped 280,000 barrels to 9.31 million in the week ended Feb. 22, Energy Information Administration data showed today. That’s the lowest seasonal level since 2008 and almost 9 percent below the five-year average, according to data compiled by Bloomberg.

Jet 54 strengthened 0.5 cent to a premium of 13.5 cents a gallon versus heating oil futures on the New York Mercantile Exchange at 3:38 p.m., the highest level since Jan. 30. The fuel has rallied almost 13 percent this month from a 12-cent premium at the end of January.

Supplies of the aviation fuel slid for a second week in the region, even as East Coast jet fuel imports gained 19,000 barrels to 32,000 last week, EIA data showed.

The New York-Gulf Coast jet fuel spread widened 2.53 cents to 6.93 cents a gallon. The fuel on the Gulf was unchanged at a premium of 8.5 cents.

Gasoline weakened in New York after inventories increased amid a climb in East Coast imports. Refineries boosted activity in the region for the first time in six weeks.

‘Increased Imports’

“The region saw a slight build this week off the back of increased imports,” a CIBC World Markets Inc. report showed.

Stockpiles of motor fuel in the Central Atlantic region, which includes New York and is known as PADD 1B, grew 153,000 barrels to 33.5 million barrels last week, EIA data compiled by Bloomberg showed.

Imports of gasoline rose 48,000 barrels to 495,000 barrels, while East Coast refineries processed 968,000 barrels a day of crude and other feedstock, 3.5 percent higher than the week earlier, according to EIA data.

Reformulated, 84-octane gasoline slid 0.13 cent to 2.63 cents a gallon below Nymex futures, the lowest level since Feb. 14, data compiled by Bloomberg show. The differential between motor fuel in New York and the Gulf Coast fell 4.22 cents to 2.72 cents a gallon.

The 3-2-1 crack spread in New York, a measure of refining profitability based on Brent oil in Europe, retreated $3.21 to almost $10 a barrel. The same spread on the U.S. Gulf Coast, based on West Texas Intermediate in Cushing, Oklahoma, slipped $3.86 to $29.25 a barrel, while the crack for Light Louisiana Sweet

Conventional, 87-octane gasoline on the Gulf strengthened 1.25 cents to trade 3.25 cents under futures. Inventories of the fuel slumped 1.86 million barrels to 75.5 million last week, the sixth consecutive weekly decline, according to EIA data.

To contact the reporter on this story: Christine Harvey in New York at charvey32@bloomberg.net

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

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