March 19 (Bloomberg) -- Gulf Coast oils strengthened in the spot market as the bulk of spring refinery maintenance is ending, bringing back demand for crude.
Planned turnarounds between January and March took 1.13 million barrels a day of crude processing capacity offline, according to IIR Energy, a Sugar Land, Texas-based energy-information provider. From April to June, that figure will drop to 676,000 barrels.
Offshore oils Light Louisiana Sweet and Heavy Louisiana Sweet strengthened, with LLS gaining 95 cents to a $22.25 premium over U.S. benchmark West Texas Intermediate oil, as of 11:05 a.m. New York time, according to data compiled by Bloomberg. HLS widened its premium by 90 cents to $23.25.
Several refineries finished or were near finishing maintenance this week and next.
In the Midwest, Husky Energy Inc.’s 160,000-barrel-a-day refinery in Lima, Ohio will return from a maintenance shut down next week, a spokesman said in an e-mail yesterday. Phillips 66’s Wood River, Illinois, refinery returned a 120,000-barrel-a-day crude unit to full rates, a person familiar with the matter said yesterday. A 150,000-barrel-a-day unit at the plant is at half-capacity and expected to return to full rates within a week.
On the Gulf Coast, Valero Energy Corp.’s Port Arthur, Texas, refinery restarted its 57,000-barrel-a-day hydrocracker over the weekend after it had been shut since March 7 for repairs, a spokesman said by e-mail yesterday.
The increased demand due to refinery restarts also supported the price of West Texas Intermediate, the benchmark for domestic crude, over international Brent prices. The discount of WTI to Brent narrowed by 50 cents to $14.90 at 12:50 p.m. New York time.
LLS’s premium to Dated Brent jumped to $7.57 a barrel, the highest level since October 2008.
Other Gulf Coast oils also strengthened. Poseidon’s premium gained $1.25 to $18.45 a barrel. Mars Blend’s premium added $1.35 to $18.15. Thunder Horse and Southern Green each strengthened by 65 cents to trade at $20.15 and $15.25 above WTI, respectively.
In Texas’s Permian Basin, WTI Midland strengthened by 5 cents to trade at a 20-cent discount to the same grade delivered to the U.S. supply hub in Cushing, Oklahoma.
In Canada, the prices of Western Canada Select and Syncrude grades were unchanged. Index trading for April delivery for the grades ended on March 15. The majority of the volume in Canadian grades is traded during the index period, which begins on the first of the month.
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