Los Angeles Gasoline Jumps to Three-Month High on Plant Upsets

Jan. 24 (Bloomberg) -- Spot gasoline in Los Angeles surged against futures after Valero Energy Corp. was said to be shutting an alkylation unit at its Wilmington plant next week and Chevron Corp. and Phillips 66 reported equipment shutdowns.

Valero’s 78,000-barrel-a-day Wilmington refinery near Los Angeles will shut the alkylation unit for about seven to 10 days of repairs on a depropanizer, a person familiar with the plans said. Bill Day, a spokesman at Valero’s headquarters, said by e-mail that he couldn’t confirm the planned work.

California-blend gasoline, or Carbob, in Los Angeles strengthened 22.75 cents to 21.25 cents a gallon against gasoline futures traded on the New York Mercantile Exchange at 3:57 p.m. East Coast time, data compiled by Bloomberg show. That’s the highest level for the fuel since Oct. 15. Prompt-delivery in Los Angeles rose 25.33 cents to $3.0872 a gallon.

The Wilmington refinery’s alkylation unit was shut Dec. 21 to repair a leak, bringing down the plant’s fluid catalytic cracker with it. Both units were started last week, and the cracking unit has “not yet reached planned rates,” Day said.

BP Plc, Chevron and Tesoro Corp. are performing maintenance on process units at their own refineries in Southern California.

The discount for Carbob in San Francisco narrowed 12.5 cents to 3.5 cents a gallon against futures, a three-week high. Prompt-delivery of the fuel rose 15.08 cents to $2.8397 a gallon, the highest since Oct. 16.

Chevron Richmond

Chevron reported a unit shutdown at the 240,000-barrel-a-day Richmond refinery, Northern California’s largest, a notice to Contra Costa County regulators showed. Phillips 66’s 76,000-barrel-a-day Rodeo refinery near San Francisco also shut a unit Jan. 22, the company said in a regulatory filing.

Tesoro extinguished a “small” motor fire on a maintenance boat stationed at the wastewater treatment plant at its 170,000-barrel-a-day Golden Eagle refinery in Northern California, Tina Barbee, a spokeswoman at Tesoro’s headquarters in San Antonio, said by e-mail. The fire had no impact on refinery operations, she said.

San Francisco Carbob widened its discount to the fuel in Los Angeles by 10.25 cents to 24.75 cents a gallon, the biggest gap since Jan. 14.

Gasoline stockpiles on the U.S. West Coast, known as the PADD 5 region, fell for the first time in five weeks, losing 217,000 barrels to 36 million in the seven days ended Jan. 18, the Energy Information Administration, an Energy Department agency, said. Distillate fuel oil inventories tumbled 7.8 percent to 15.1 million barrels.

California Diesel

California-blend, or CARB, diesel in Los Angeles advanced 1.75 cents to a 6.75-cent premium to Nymex heating oil futures. The same fuel in San Francisco gained 1.25 cents to a premium of 3.75 cents a gallon against futures.

The 3-2-1 refinery crack spread between Alaskan North Slope crude, Carbob in Los Angeles and CARB diesel in Los Angeles, widened $6.938 to $21.02 a barrel, the highest since Nov. 9. The crack, a measure of refining profitability, fell to a year-low of $3.858 a barrel on Dec. 5.

In Portland, low-sulfur diesel narrowed its discount 2.5 cents to 4 cents a gallon against heating oil futures. Conventional, 84-octane gasoline there strengthened 10 cents to 13 cents a gallon below the Nymex gasoline contract.

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