Gulf Coast Gasoline Weakens After Phillips 66 Reports Restart

Spot gasoline discounts on the U.S. Gulf Coast widened against futures for the second straight day after Phillips 66 reported a unit startup at the Borger refinery in Texas.

The 146,000-barrel-a-day plant was preparing to begin starting the Unit 40 fluid catalytic cracker, the company said in a notice to the Texas Commission on Environmental Quality yesterday. Fluid Catalytic crackers process vacuum gasoil into gasoline and other lighter products.

Conventional, 87-octane gasoline dropped 1 cent against futures on the New York Mercantile Exchange to a discount of 10.25 cents a gallon at 4:05 p.m., according to data compiled by Bloomberg. Conventional CBOB gasoline weakened 1.75 cents to 11.25 cents a gallon below futures.

Marathon Petroleum Corp.’s 451,000-barrel-a-day Galveston Bay refinery reported an Oct. 14 valve leak associated with the No. 3 ultraformer, a notice to state regulators shows. Jamal Kheiry, a spokesman for Marathon in Findlay, Ohio, declined by e-mail yesterday to comment on the upset.

The 3-2-1 crack spread on the Gulf Coast, a rough measure of refining margins for gasoline and diesel fuel based on West Texas Intermediate oil in Cushing, Oklahoma, narrowed 7 cents to $11.93 a barrel. Cracks based on Light Louisiana Sweet oil, the Gulf Coast benchmark, widened 53 cents to $10.78 a barrel.

Ultra-low-sulfur diesel on the Gulf Coast spot market was unchanged against ULSD futures on the Nymex at a discount of 6 cents a gallon.

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