Chicago Fuels Gain as Crude Runs Plunge to Two-Year Low

Chicago spot gasoline and diesel strengthened versus futures after a government report showed refiners unexpectedly processed the least amount of crude in 31 months. Crack spreads widened.

Refining in the U.S. Midwest PADD 2 region tumbled by 162,000 barrels a day, or 5.1 percent, to 3.02 million in the week ended May 24, Energy Information Administration data show. That’s the lowest level since Oct. 29, 2010.

The premium for conventional, 85-octane gasoline, or CBOB, in Chicago widened 10.5 cents to 38 cents a gallon versus futures on the New York Mercantile Exchange at 12:53 p.m., a nine-month high. Ultra-low-sulfur diesel fuel strengthened by 2 cents to trade at a premium of 12.5 cents, the first advance in eight days, according to data compiled by Bloomberg.

“The market wasn’t doing anything” before the refinery report, said Mark Anderle, a trader at wholesaler Truman Arnold Cos. in Dallas. “Everyone was surprised to see that 5 percent drop.”

Stockpiles of gasoline in the Midwest increased 395,000 barrels to 48 million last week, snapping a five-week decline, according to data from the EIA, the Energy Department’s statistical arm.

The return of Calumet Specialty Products Partners LP’s 45,000-barrel-a-day Superior, Wisconsin, refinery from a turnaround may have helped increase gasoline stockpiles. The maintenance, which ended about May 20, included the shutdown of a fluid catalytic cracker and sulfur recovery unit.

Inventories of ultra-low-sulfur diesel in the region slipped 1.61 million barrels to 25.2 million, the lowest level since Dec. 21.

The 3-2-1 crack spread in Chicago, a rough measure of refining margins based on West Texas Intermediate in Cushing, Oklahoma, gained $2.95 to $37.44 a barrel.

Before it's here, it's on the Bloomberg Terminal.