Houston — Rare gasoline imports were entering the West Coast market as refiners start to emerge from maintenance, pressuring Los Angeles CARBOB down 6.50 cents Monday and dragging premium grades even lower.
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Platts assessed Los Angeles CARBOB at NYMEX May RBOB futures plus 11.50 cents/gal. Premium LA CARBOB dropped 4 cents to a 20-cent spread over CARBOB, but an overall 10.50-cent decline against the futures. Other gasoline and premium gasoline markets along the West Coast also declined.
"Bids are hard to find," one broker said, noting that the incoming cargoes are supposed to be mostly carrying components for making premium gasoline grades. "Premiums are starting to narrow."
Platts cFlow vessel-tracking software showed three cargoes from Canada and the United Kingdom expected to arrive in Southern California within a week, and a fourth off the Atlantic Coast showing a West Coast destination.
The 507,000-barrel Estia from Point Tupper, Nova Scotia, is expected to arrive in Los Angeles April 1, Platts cFlow showed. It was chartered by Vitol, sources have said. Point Tupper is the site of a NuStar oil storage terminal.
The 326,000-barrel Nave Orion and 318,000-barrel Ipanema Street were set to arrive March 31 and April 5, Platts cFlow showed. Sources said the former was carrying CARBOB and Premium CARBOB chartered by Valero, while the latter was carrying gasoline for Noble. Both ships left from Milford Haven, Wales, near Valero's Pembroke refinery, which can make the strict CARBOB grade.
Traders from the three companies did not comment on the cargoes.
The last time a gasoline blendstock cargo arrived in the West Coast from the United Kingdom was January 2012, although one arrived roughly every other month before 2008, US Energy Information Administration data showed.
Traders said they were surprised the cargoes did not divert to elsewhere as the West Coast market came off due to the end of a nationwide strike that hit California refiners hardest. Refiners were also exiting maintenance, such as Tesoro restarting its 166,000 b/d San Francisco-area plant on Friday. The Los Angeles CARBOB differential started March at plus 48 cents/gal.
A fourth ship, the 317,000-barrel Gotland Aliya, was headed from Fawley in the United Kingdom with a destination listed as Everett, Washington, scheduled for April 12. Tesoro has said it was doing first-quarter crude unit maintenance at its 120,000 b/d Anacortes refinery in Washington state, with sources saying it would end by mid-April. Platts assessed Portland suboctane 5.50 cents lower to plus 0.50 cents/gal Monday.
The broker said such cargo volume has not come from Europe at once since before the recession.
"I don't see many cargoes coming from Europe into the US West Coast," he said.
A gasoline trader echoed that statement, noting how far prices have fallen. "We might not see one again," he said. "The arbs are closed."