Gulf Coast Gasoline Strengthens After Mississippi Refinery Fire
Gasoline in the Gulf Coast region strengthened to the highest level in almost a month after a fire early today at Chevron Corp (CVX)’s Pascagoula, Mississippi, refinery killed a worker and shut a unit.
Conventional 85.5-octane gasoline, or CBOB, on the Gulf Coast gained 3 cents to a discount of 15.25 cents a gallon below New York Mercantile Exchange futures at 12:11 p.m. in New York, according to data compiled by Bloomberg, the narrowest discount since Oct. 17.
“If it’s a pretty big problem for Chevron there, they’re going to have go to the cash market to cover their branding needs,” Jim Mosby, supply manager of ADMO Energy LLC, said by phone from Kansas City, Missouri. “So people just jump in front of them in anticipation.”
Conventional, 87-octane gasoline climbed 1 cent to 15.25 cents a gallon below futures, the narrowest discount since Oct. 18.
The Pascagoula detonation took place at 2 a.m. local time in the furnace of a reformate splitter unit at the 330,000-barrel-a-day plant on Mississippi’s Gulf Coast, and the subsequent fire took about an hour to put out, Tom Kovar, general manager of the refinery, said in a press conference today at the site. The unit was called “cracking 2 area”in company statements throughout the day.
The refinery produces 130,000 barrels of gasoline, 68,000 barrels of diesel and 50,000 barrels of jet fuel a day, according to a company website. It also produces bunker fuel, liquefied petroleum gases and other products.
Conventional, 85-octane gasoline, or CBOB, in Chicago weakened by 4 cents relative to New York futures to a discount of 23 cents a gallon at 12:39 p.m. New York time. Ultra-low-sulfur diesel fuel in Chicago strengthened 0.5 cent to 3 cents below ultra-low-sulfur diesel futures.
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