Gasoline, Heating Oil Rise on Refinery Outages, Strong Demandgreenspun.com : LUSENET : Grassroots Information Coordination Center (GICC) : One Thread
Gasoline, Heating Oil Rise on Refinery Outages, Strong Demand
April 19, 2000
New York, April 18 (Bloomberg) -- Gasoline and heating oil rose as a series of refinery disruptions raised concern that production would be reduced at a time when maximum output is needed for peak summer demand for motor fuel.
Prices rose late in the session, pulling crude oil higher, after Citgo Petroleum Corp. said it shut some units at its 304,000- barrel-a-day Lake Charles, Louisiana, refinery because of a power outage. That followed problems at three other refineries, in Texas and New Jersey, that boosted prices yesterday.
After the news of the Citgo refinery, ``gasoline ran up and crude had no choice but to follow,'' said Dominick Caglioti, a broker at ABN Amro Energex in New York. ``That's a big, big refinery. Given the opportunity to trade off the headline, that's exactly what we did.''
Gasoline for May delivery rose 0.88 cent, or 1.1 percent, to 82.86 cents a gallon on the New York Mercantile Exchange, rebounding from an earlier decline. May heating oil, which was up throughout the session, rose 1.31 cents, or 1.9 percent, to 70.78 cents a gallon.
In addition to the Lake Citgo refinery problems, Crown Central Petroleum Corp. on Sunday shut a 23,000-barrel-a-day reformer unit at its refinery in Pasadena, Texas, for 10 days of unplanned maintenance, analysts said today. The company did not confirm the report.
Yesterday, Motiva Enterprises LLC said a unit at its Port Arthur, Texas, refinery could remain shut at least until late next week, about a week longer than expected earlier. The fluid catalytic cracker unit, which has the capacity to process 83,000 barrels of oil products a day, was closed on March 29.
Valero Energy Corp. yesterday said it expected to restart Saturday a unit at its Corpus Christi, Texas, refinery that was shut down for unscheduled maintenance last Friday. Valero also said it expected to restart a catalytic cracker, crude distillation and alkylation unit at its Paulsboro, New Jersey, refinery on May 10.
Crude oil, which was little changed for most of the session, rose late in the day, pulled higher by products.
Traders were waiting for an industry report due out late in the day that could show whether increased output from OPEC is replenishing U.S. inventories that sank to their lowest level in two decades in January.
The American Petroleum Institute was scheduled to issue its weekly supply report after the close of trading. Prices have been volatile this month, trading between about $24 and $26 a barrel as the Organization of Petroleum Exporting Countries increased quotas.
Crude oil for June delivery rose 26 cents to $24.83 a barrel on the Nymex. The May contract, which expires tomorrow, rose 22 cents to $26.11.
In London, Brent crude oil for June settlement rose 31 cents to $23.05 a barrel on the International Petroleum Exchange.
Today's API report was expected to show that U.S. crude oil inventories rose for a third straight week, according to analysts surveyed by Bloomberg News.
While inventories already had risen 5.6 percent since reaching a 23-year low on Jan. 28, they still were 13 percent lower than a year earlier, at 298.38 million barrels, as of April 7.
U.S. refiners are beginning to replenish supplies after restricting purchases as crude oil surged to a nine-year high in early March. Crude oil prices have retreated by about 25 percent from the high on increased output from OPEC, which voted last month to rescind output restrictions that sparked the rally.
-- Carl Jenkins (Somewherepress@aol.com), April 19, 2000