Bloomberg News

Gulf Coast Diesel Strengthens as Petroplus Plans for Insolvency

January 24, 2012

Jan. 24 (Bloomberg) -- Gulf Coast diesel strengthened on speculation that Europe will import more fuel after Petroplus Holdings AG, the largest independent European refinery, said it expects to file for insolvency.

Petroplus is processing 115,000 barrels a day, about half of its capacity, at the Coryton plant in the U.K., according to a company official who declined to be identified because he isn’t authorized to speak to the media. Loadings at the refinery and the distribution of products around the U.K. have been disrupted, the company official said.

The discount for ultra-low-sulfur diesel on the Gulf Coast versus heating oil futures traded on the New York Mercantile Exchange narrowed 0.33 cent to 2.5 cents a gallon at 2:16 p.m., according to data compiled by Bloomberg. Prompt delivery increased 0.74 cent to $3.0002 a gallon.

Coryton is producing about 100,000 metric tons a month, or 25,000 barrels a day, of ultra-low-sulfur diesel, the Petroplus official said.

Petroplus said on Jan. 5 the Coryton plant was operating at 45 percent of capacity.

The discount for conventional, 87-octane gasoline in the Gulf Coast widened 1.25 cents to 3.5 cents a gallon. Prompt delivery rose 1.09 cents to $2.7759.

--With assistance from Lananh Nguyen in London. Editors: Richard Stubbe, Margot Habiby

To contact the reporter on this story: Paul Burkhardt in New York at pburkhardt@bloomberg.net.

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net.


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