Gulf Coast spot gasoline strengthened after a fire shut a crude unit at Motiva Enterprises LLC’s Port Arthur, Texas, refinery.
Conventional, 87-octane gasoline on the Gulf Coast increased 1.25 cents to a discount of 24 cents a gallon to futures traded on the New York Mercantile Exchange at 2:01 p.m., according to data compiled by Bloomberg. The discount Dec. 10 reached 29.5 cents a gallon, the lowest level since Bloomberg began assessing the grade in May 1991.
The crude unit, which has a capacity of 325,000 barrels a day, was processing about 240,000 barrels before the fire, a person with knowledge of the situation said.
Motiva expects to return the unit to normal operations in an “expeditious manner,” Kimberly Windon, a Houston-based spokeswoman for Motiva, said in an e-mail. The fire was “very small and was rapidly extinguished.”
“I think the spot market reacted bullishly,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. “Now that it turns out it was just minor and that they’re going to be restarting the unit shortly, I think the impact is going to be quite mitigated.”
Ultra-low-sulfur diesel in the Gulf fell 0.37 cent to a discount of 1.25 cents a gallon to heating oil futures on the Nymex.