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N.Y. Gasoline Snaps Rally on Northeast Plant FCC Start Up

Aug. 27 (Bloomberg) -- New York Harbor gasoline fell from the strongest level in six months as a refinery in the U.S. Northeast restarted a unit following a shutdown.

Conventional, 87-octane gasoline weakened 0.88 cent to a discount of 0.13 cent a gallon below futures on the New York Mercantile Exchange at 2:07 p.m., the lowest level in a week. The spread rallied to a premium of 0.75 cent a gallon on Aug. 23 after Delta Air Lines Inc.’s Trainer plant reported the halt of a fluid catalytic cracker.

Conventional, 83.5-octane gasoline, or CBOB, in the region, slipped 0.5 cent to 10.5 cents a gallon below futures, a third consecutive decline and the biggest discount in a week. Reformulated, 84-octane gasoline, or RBOB, slid 0.25 cent to a premium of 2.88 cents a gallon.

The 185,000-barrel-a-day Pennsylvania refinery operated by Delta subsidiary Monroe Energy LLC began restarting the unit at about 6:51 a.m. local time yesterday, according to a report by Genscape Inc. The company said Aug. 23 that the 52,000-barrel-a-day catalytic cracker was down and was expected to be back in operation within 48 hours.

Irving Oil Corp.’s Saint John, New Brunswick, refinery reported the shutdown of a 70,000-barrel-a-day catalytic cracker last week. Over half of the refinery’s finished products, including gasoline and diesel, are exported to the U.S. Northeast.

Return of units at the two refineries may add to stockpiles on the U.S. East Coast, which according to government data fell by 2.74 million barrels to 58.5 million in the week ended Aug. 16, the lowest level since March 29.

N.Y. Diesel

Ultra-low-sulfur diesel in New York Harbor gained 0.12 cent to a discount of 0.13 cent below ULSD futures on the Nymex. The 3-2-1 regional crack spread, a rough measure of refining margins for gasoline and diesel based on Brent oil in Europe, slid 38 cents to $14.32 a barrel.

Gasoline on the U.S. Gulf Coast weakened after Motiva Enterprises LLC reported that the Convent, Louisiana, refinery returned to planned rates. The 255,000-barrel-a-day plant shut units after a fire on Aug. 19.

Conventional CBOB Gulf gasoline slipped 2.13 cents to a discount of 8.38 cents a gallon below futures, while conventional, 87-octane gasoline dropped 2 cents to a premium of 2.25 cents a gallon.

The 3-2-1 crack spread on the Gulf, based on West Texas Intermediate oil in Cushing, Oklahoma, dropped 61 cents to $13.89 a barrel, a fourth consecutive decline, according to data compiled by Bloomberg. The same spread based on Light Louisiana Sweet oil slipped 21 cents to $11.09 a barrel.

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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