Spot gasoline in Los Angeles gained against futures for the first time in seven days after Tesoro Corp. (TSO:US)’s Southern California refinery reported a unit trip.
The unit at the 97,000-barrel-a-day Los Angeles plant in Wilmington went offline Aug. 18 after a “third party equipment issue,” Tina Barbee, a spokeswoman at Tesoro’s headquarters in San Antonio, said by e-mail yesterday. She didn’t respond to e- mails asking whether the upset was related to a breakdown at Air Products and Chemicals Inc.’s Carson plant, which delivers hydrogen to refineries nearby.
California-blend gasoline in Los Angeles gained 1.5 cents to 3 cents a gallon above futures traded on the New York Mercantile Exchange at 1:35 p.m. East Coast time, according to data compiled by Bloomberg. The fuel’s premium had narrowed for six days on speculation that Chevron Corp. (CVX:US) would run units at the Richmond refinery off feedstock delivered by tanker after an Aug. 6 fire shut the crude unit.
Air Products’ Carson hydrogen plant reported a breakdown at 3 p.m. local time Aug. 18, less than an hour before Tesoro reported the unit trip at the Los Angeles refinery. The hydrogen plant is scheduled to flare until midnight tomorrow because of the breakdown, a notice to the South Coast Air Quality Management District showed.
Art George, an Air Products spokesman at the company’s headquarters in Allentown, Pennsylvania, didn’t respond to a request e-mailed yesterday for comment on the malfunction.
California-blend gasoline in San Francisco also rose 1.5 cents to 13 cents a gallon over futures. The fuel’s premium is down 67 percent from this month’s peak of 39 cents a gallon versus futures on Aug. 9.
Chevron’s 240,000-barrel-a-day Richmond refinery is scheduled to export a cargo of base oil to Brazil this week. Two other tankers are signaling for the refinery, which shut its only crude unit following the Aug. 6 blaze, ship-tracking data compiled by Bloomberg shows.
At least four tankers sailed last week to Richmond from Italy, Japan, Argentina and Algeria, carrying cargoes including vacuum gasoil and fuel oil that can help the plant keep running while one of its crude units is damaged.
“Chevron’s reaction here, to scour the market for feedstock cargoes to keep the refinery running, illustrates their determination to supply the market,” David Hackett, the president of Stillwater Associates, an independent fuel consultant in Irvine, California, said by e-mail. “Clearly, the market is comfortable that gasoline supplies are adequate.”
California-blend, or CARB, diesel in San Francisco was unchanged at 24 cents a gallon over Nymex heating oil futures. The same fuel in Los Angeles was steady at 18 cents a gallon above futures.
Conventional, 87-octane gasoline in Portland, Oregon, remained at a premium of 21.5 cents a gallon against gasoline futures. Low-sulfur diesel’s premium in Portland held at 33.5 cents above heating oil futures.
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