New York Gasoline Weakens on Restart of Delta Trainer FCC

Gasoline in New York Harbor weakened versus futures on speculation that Delta Air Lines Inc. will restart a fluid catalytic cracker in Pennsylvania this week.

The catalytic cracker, which was initially expected to be offline for 10 days to 14 days, has been shut since December to address issues with a slurry oil circuit, said Trebor Banstetter, a spokesman for Delta in Atlanta. Slurry oil is a byproduct of a catalytic cracker, heavy gasoil is broken down into lighter products. Slurry can be used as feedstock for cokers and hydrocrackers and blended into residual fuel.

The Trainer refinery operated by Delta’s Monroe Energy LLC subsidiary is the third-largest on the East Coast, data compiled by Bloomberg show. The plant has the capacity to process as much as 185,000 barrels a day and has a catalytic cracking capacity of 75,000 barrels daily.

Reformulated 84-octane gasoline in New York Harbor weakened 0.75 cent to trade at a discount of 0.75 cent against futures traded on the New York Mercantile Exchange at 3:15 p.m. The futures were at parity over the past two trading days, according to data compiled by Bloomberg.

Supplies of motor gasoline in the Central Atlantic region encompassing New York Harbor climbed to 29 million in the week ended Jan. 25, the Energy Information Administration reported last week. That was the sixth consecutive weekly increase and the highest level since April 2012.

Stockpiles of distillates, including diesel fuel and heating oil, in the region dropped to 23.8 million last week, EIA data showed. Ultra-low-sulfur diesel in New York Harbor slipped 0.38 cent to a premium of 5.25 cents a gallon over heating oil futures, a second daily decline.

Refinery Margins

The 3-2-1 crack spread, a measure of refining profitability based on Brent oil in Europe, fell 25 cents to $13.91 a barrel at 3:59 p.m.

Conventional, 87-octane gasoline on the Gulf Coast, known as Padd 3, dropped 1.5 cents to 22 cents a gallon below futures, while ultra-low-sulfur diesel gained 0.38 cent to 0.63 cent above heating oil futures.

The 3-2-1 crack spread for Light Louisiana Sweet oil in the Gulf dropped 24 cents to $6.76 a gallon.