Gasoline in Los Angeles advanced to the highest level against futures in three weeks on speculation that refiners are buying fuel and after Tesoro Corp. (TSO:US)’s Los Angeles plant suspended work on a new unit.
BP Plc (BP/) and Exxon Mobil Corp. (XOM:US) were performing planned work on units at their refineries near Los Angeles. California-blend gasoline, or Carbob, inventories dropped 3.9 percent last week to 4.55 million barrels, the lowest level in a month, the state Energy Commission said.
Carbob in Los Angeles jumped 6.75 cents to a premium of 4.75 cents a gallon versus August gasoline futures traded on the New York Mercantile Exchange at 2:47 p.m. East Coast time, according to data compiled by Bloomberg. Prompt-delivery of the fuel increased 9.02 cents to $2.5222 a gallon.
Tesoro was ordered by city regulators to halt work on a new $40 million vacuum distillation unit at the Los Angeles refinery that would boost the plant’s gasoline, diesel and jet fuel yields. The company started work without completing inspections required by the city, David Lara, a spokesman for the Los Angeles building and safety department, said.
City inspectors are waiting on testing data from Tesoro “to see if there’s an evaluation they can do without having to tear everything out and start over,” Lara said by telephone from Los Angeles yesterday.
Carbob in San Francisco rose 6.75 cents a gallon to 2.75 cents a gallon above futures.
California-blend, or CARB, diesel in Los Angeles, slipped 0.13 cent to a 4.25-cent-a-gallon premium over Nymex heating oil futures. San Francisco CARB diesel was unchanged at 4.13 cents a gallon above futures.
The discount for conventional, 87-octane gasoline in Portland, Oregon, narrowed 4 cents to 7 cents a gallon. Low- sulfur diesel there rose 3.25 cents to 9.5 cents a gallon above heating oil futures.
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