Los Angeles Gasoline Premium Surges After BP Said to Cut Rates
Spot gasoline in Los Angeles jumped to a one-week high against futures after BP Plc (BP/)’s Carson refinery was said to cut rates and stockpiles of the fuel in the state dropped to the least since December.
Carson’s fluid catalytic cracker, which processes vacuum gasoil into lighter crude products such as gasoline, may run at lower rates for several days during maintenance on a compressor, a person with knowledge of the work said late yesterday. BP’s refinery is the second-largest in California.
California-blend gasoline, or Carbob, supplies tumbled 5.5 percent in the week ended March 8 to 6.24 million barrels, the lowest level since Dec. 28, the state Energy Commission’s website shows. Output of the fuel also dropped last week, down 3.2 percent to 6.01 million barrels.
Carbob in Los Angeles surged 6 cents to a discount of 10 cents a gallon against gasoline futures traded on the New York Mercantile Exchange at 4:03 p.m., data compiled by Bloomberg show. That’s the highest level since March 6. Prompt delivery gained 5.21 cents to $3.0423 a gallon.
The Carson plant supplies 25 percent of Los Angeles’s gasoline and produces half the jet fuel used by Los Angeles International Airport, according to BP’s website. Scott Dean, a BP spokesman in Warrenville, Illinois, didn’t immediately return telephone and e-mailed requests for comment on the cracking unit’s status.
Chevron Corp. (CVX)’s 279,000-barrel-a-day El Segundo refinery, the largest in California, has extended work on its own fluid catalytic cracker until at least the end of the month, a person with knowledge of the plan said last week. The maintenance, which began in mid-January, had been expected to last 54 days.
Carbob in San Francisco rose 5 cents against futures to a discount of 12 cents a gallon, the highest level since March 1.
The spread between the fuel in San Francisco and Los Angeles narrowed 1 cent, with San Francisco at a 2-cent-a-gallon discount to Los Angeles. The gap reached a record 32.5 cents a gallon on Jan. 14.
California-blend, or CARB, diesel in Los Angeles and San Francisco weakened to premiums of 4.5 cents and 6.5 cents a gallon against Nymex heating oil futures, respectively.
CARB diesel stockpiles rose for the third straight week, increasing 2.8 percent to 2.44 million barrels, the state Energy Commission said. Production of the fuel jumped 3.1 percent to 1.97 million barrels.
In Portland, Oregon, low-sulfur diesel dropped 2 cents to a premium of 15.5 cents a gallon versus futures. Conventional, 84- octane gasoline in Portland tumbled 4 cents against futures to a discount of 16 cents a gallon, a seven-week low.
Gasoline inventories on the U.S. West Coast, known as the Padd 5 region, fell 3.5 percent in the week ended March 8 to 31.4 million barrels, the lowest level since November, the Energy Information Administration said today. Production of the fuel slid 2.6 percent to 1.49 million barrels a day, according to the Energy Department’s statistical arm.
Distillate fuel oil stockpiles on the West Coast tumbled 3.9 percent to 13 million barrels last week, the lowest level since Nov. 23, the EIA said.
The 3-2-1 crack spread of Alaska North Slope crude, Carbob in Los Angeles and CARB diesel in Los Angeles gained for the first time in three days, rising $1 to $17.33 a barrel at 4:06 p.m. New York time. The spread, a measure of refining profitability, hit a one-year low of $3.86 a barrel in December.
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