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California Gasoline Weakens After Valero, Tesoro Restart Units

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Jan. 18 (Bloomberg) -- Spot gasoline in Los Angeles slid against futures for the fourth straight day after Valero Energy Corp. started two units at its refinery in Southern California.

Valero’s 78,000-barrel-a-day Wilmington plant near Los Angeles returned to service the fluid catalytic cracker and the alkylation unit, which were shut Dec. 21 to repair a leak, Bill Day, a Valero spokesman at the company’s headquarters in San Antonio, said by e-mail today.

Both units are increasing to “planned rates,” Day said.

California-blend gasoline, or Carbob, in Los Angeles weakened 6 cents to a discount of 5.5 cents a gallon against futures traded on the New York Mercantile Exchange at 4:01 p.m. East Coast time, data compiled by Bloomberg show. It’s the steepest discount since Dec. 20.

Carbob in San Francisco weakened 7 cents to 27.5 cents a gallon below futures, the lowest since Dec. 17.

Tesoro’s 170,000-barrel-a-day Golden Eagle refinery near San Francisco returned a hydrocracker after finishing repairs, a person with direct knowledge of operations at the plant said yesterday. The plant also started the No. 3 hydrotreater and reformer, which were unexpectedly shut over the weekend, said the person who asked not to be identified because the information isn’t public.

The refinery reported a “major unit startup” yesterday, a notice to Contra Costa County regulators shows.

El Segundo

Chevron Corp.’s 279,000-barrel-a-day El Segundo plant, California’s largest refinery, Tesoro’s Los Angeles plant and BP Plc’s Carson refinery are all performing maintenance turnarounds on process units.

The 3-2-1 refinery crack spread between Alaskan North Slope crude, Carbob in Los Angeles and California-grade diesel in Los Angeles, has shrunk to almost a sixth of a record $60.239 a barrel reached on Oct. 4. The crack, a measure of refining profitability, narrowed 28 cents to $10.512 a barrel, data compiled by Bloomberg show.

Carbob in San Francisco widened its discount to Los Angeles 1 cent to 22 cents a gallon. It weakened to a record 32.5 cents a gallon below Los Angeles on Jan. 14.

California-blend, or CARB, diesel in Los Angeles strengthened 2.75 cents to a 7.25-cent premium to Nymex heating oil futures. The discount for the same fuel in San Francisco was unchanged at 2 cents a gallon.

In Portland, low-sulfur diesel widened its discount 2 cent to 9 cents a gallon, while conventional, 84-octane gasoline in strengthened 1 cent to 20 cents a gallon below futures.

To contact the reporter on this story: Lynn Doan in San Francisco at ldoan6@bloomberg.net

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

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