Gasoline on Gulf Coast Sinks as U.S. Fuel Output Rises to RecordLynn Doan
Spot gasoline on the U.S. Gulf Coast tumbled to the lowest level in more than a week as the U.S. produced a record amount of the motor fuel.
The discount for Gulf Coast gasoline widened after gasoline output jumped 4.3 percent to 9.72 million barrels a day in the week ended Dec. 20, the most in data going back to 1982, the Energy Information Administration said Dec. 27.
Conventional, 84-octane gasoline, or RBOB, on the Gulf weakened 3.5 cents against futures traded on the New York Mercantile Exchange to a discount of 16 cents a gallon, a one-week low, according to data compiled by Bloomberg at 4:11 p.m. East Coast time.
The values will probably be little changed this week with many traders taking the latter part of December off for the Christmas holiday and New Year’s, said Jim Mosby, partner at ADMO Energy LLC, a supply consultant in Kansas City, Kansas. “Lots of people take these weeks off and things will probably stay this way through the end of the week.”
The discount for conventional, 87-octane gasoline widened 1 cent to 18 cents a gallon, and conventional gasoline to be blended with ethanol, or CBOB, slipped 0.5 cent to 20.25 cents below futures.
The 3-2-1 crack spread on the Gulf Coast, a rough measure of refining margins based on West Texas Intermediate oil in Cushing, Oklahoma, dropped 31 cents to $15.42 a barrel at 4:15 p.m. New York time, data compiled by Bloomberg showed. The same spread based on Light Louisiana Sweet oil, the Gulf Coast benchmark, narrowed 36 cents to $10.87 a barrel.
Unleaded, 85-octane gasoline in the U.S. Midwest, known as Group 3, advanced 1.25 cents to a discount of 27.75 cents a gallon against Nymex futures, the highest level in almost seven weeks. Conventional gasoline in Chicago strengthened 0.5 cent to a discount of 20.5 cents a gallon.
Prices climbed as Marathon Petroleum Corp.’s 84,500-barrel-a-day Canton refinery in Ohio reported a wet-gas compressor trip. The equipment issue is “ongoing,” Terri Dzienis, the city’s pollution control administrator, said by telephone.