Market watch: Gasoline futures surge with diminished refining
Gasoline futures prices surged Thursday on the New York Mercantile Exchange with reports that a few Gulf Coast refineries would temporarily reduce operations for routine maintenance.
By the OGJ Online Staff
HOUSTON, July 13 -- Gasoline futures prices surged Thursday on the New York Mercantile Exchange with reports that a few Gulf Coast refineries would temporarily reduce operations for routine maintenance.
Traders also apparently reacted to unconfirmed reports that a Virginia refinery was suffering power outages.
Premcor Inc., St. Louis, Mo., earlier reported plans to shut down the crude unit at its 250,000 b/d Port Arthur, Tex., refinery for 10 days to clean heaters fouled by a recent lightning strike, and for other maintenance (OGJ Online, July 12, 2001).
The August contract for unleaded gasoline jumped 2.25¢ to 75.33¢/gal on the NYMEX, while home heating oil for the same month inched up 0.08¢ to 70.67¢/gal.
Crude futures declined with continued speculation that Iraq will soon resume its oil exports. Benchmark US light, sweet crude for August delivery dropped 31¢ to $26.80/bbl, and the September contract lost 24¢ to $26.45/bbl.
In after-hours electronic trading, however, both contracts improved to $26.82/bbl and $26.47/bbl, respectively.
The August contract for natural gas gained 8.6¢ to $3.43/Mcf on the NYMEX.
In London, the word around the International Petroleum Exchange was that US refiners were reducing operations to protect their shrinking profit margins. Traders apparently seized on that speculation to justify a heavy sale of North Sea Brent oil futures.
The August Brent crude contract dropped below $25/bbl in early afternoon trade, down to $24.53/bbl before recovering. It closed at $25.24/bbl, down 38¢ for the day. The August natural gas contract also lost 3.4¢ to the equivalent of $2.56/Mcf on the IPE.
The average price for the Organization of Petroleum Exporting Countries' basket of seven crude lost 45¢ to $23.44/bbl Thursday.