Spot Premium Gasoline in Chicago at Record After BP BlazeLynn Doan
Premium gasoline in the Chicago area surged to a record against futures in New York today after a fire last week at the biggest refinery supplying the region.
The premium for 91-octane gasoline in Chicago jumped 30 cents a gallon to 85 cents over futures traded on the New York Mercantile Exchange at 4:27 p.m. New York time, data compiled by broker Danaher Oil Co. based in Fairfield, Iowa, show. That’s the biggest spread for the higher-grade fuel since at least 1996.
Premium prices surged after an Aug. 27 blaze at BP Plc’s 405,000-barrel-a-day Whiting refinery in Indiana. The fire, which ignited at a cat-feed hydrotreater, reduced rates on all units at the plant, according to the Sugar Land, Texas-based data provider IIR Energy.
BP was seen in the Chicago market looking for premium gasoline after the upset, Ed Malloy, president of Danaher Oil, said by telephone from Fairfield.
“Before that, people hadn’t been shipping anything from the Gulf Coast and we weren’t seeing anything coming out of the refineries,” Malloy said. “So there wasn’t much in storage.”
Scott Dean, a Warrenville, Illinois-based spokesman for London-based BP, declined by e-mail to comment.
Regular gasoline in Chicago weakened 1.5 cents to a premium of 13.5 cents a gallon versus futures.
Gasoline stockpiles in the Midwest, known as the Padd 2 region, are at the lowest seasonal level in seven years. Supplies dropped for the fifth straight week in the seven days ended Aug. 22, sliding by 1.01 million barrels to 46 million, according to the Energy Information Administration, the Energy Department’s statistical arm.