Jan. 26 (Bloomberg) -- Chicago gasoline strengthened on speculation that ConocoPhillips lowered production at its Wood River refinery in Illinois. Conoco called the rumors unfounded and said operations are “routine” at the plant.
“Word has them cutting runs in half,” Steve Mosby, vice president of ADMO Energy LLC, a supply consultant in Kansas City, Missouri, said in an instant message. Profit margins for using West Texas Intermediate crude oil to make fuel products “aren’t going to cut it,” he said.
The discount for conventional, 87-octane gasoline in Chicago narrowed 2.5 cents to 25 cents a gallon versus futures traded on the New York Mercantile Exchange at 4:12 p.m., according to data compiled by Bloomberg. The discount was 33 cents on Jan. 24. Prompt delivery rose 3.84 cents to $2.6008 a gallon.
“Recent rumors and reports of the Wood River Refinery cutting rates are unfounded and operations at the refinery are routine at this time,” Rich Johnson, a spokesman for Conoco, said in an e-mail.
The 380,900-barrel-a-day plant is jointly owned by ConocoPhillips and Cenovus Energy Inc.
Last month ConocoPhillips completed a project to increase the refinery’s crude capacity by 50,000 barrels a day and enhance its ability to process heavy Canadian crude.
Conventional, 87-octane in the Midwest, or Group 3, strengthened 0.5 cent to a discount of 21.25 cents a gallon versus futures.
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