RSS feedrefineries
’WTI arbitrage is a PADD II windfall
There’s been some interesting commentary on Friday regarding the ongoing problem of the widening WTI- Brent spread, which struck a record wide in like-for-like basis terms on Thursday.
First this from John Kemp at Reuters,
Let them eat Petroplus refineries!
That’s the share price of Swiss oil refiner Petroplus holding on Monday.
According to Reuters, the company’s stock fell as much as 9.5 per cent on the days as concerns the company could be forced to breach loan covenants grew following deterioration of one of the company’s key refining benchmarks.
Nobody ❤ gasoline
Could it be that nobody in the US wants gasoline anymore?
On Wednesday, John Kemp of Reuters observed how the combined stock of crude oil and refined products in commercial storage around the US had surged to 1.130bn barrels — the highest level since weekly records began in 1990.
Gasoline vs bimbos with big hair
We didn’t say that..
Stephen Schork of the daily energy Schork report did. And here’s the graph, charting exactly that. Gasoline versus err, bimbos, by which he actually means entertainment spending in the US as a percentage of total consumption expenditure (the reference is to Snooki in case you’re really curious):
Refinery slowdown, China edition
Vienna-based energy consultants JBC Energy have turned our attention to an interesting story on Friday.
According to Reuters, Chinese refineries will be scaling back crude runs by a sizeable 5.6 per cent in March.
Total refinery strike down *alert*
Here’s a story that’s currently topping the minds of most energy traders in Europe, via Bloomberg:
Feb. 22 (Bloomberg) — Total SA unions called for a refinery strike to spread to all French plants and said fuel shortages could be imminent.
US petroleum stocks fit for bursting
Weekly US energy inventory data release on Wednesday confirmed the unbelievable. US petroleum stocks rose in the week despite especially cold weather in the region during the period.
Meanwhile, Dennis Gartman of the Gartman Letter draws attention to the fact that aggregate inventory rose by 8.9m barrels,
Energy irony
As FT Alphaville reported, a number of US refineries have had to mothball plants in the last month due to poor product margins. Ironically, this action may now be beginning to boost product cracks (the difference between crude and product prices and what determines refinery profitability).
Gasoline cracks are strengthening
Take out some refinery production in the US amidst weak global demand for distillates, and what happens? The RBOB gasoline crack — the US benchmark measure of the difference between the price of crude and that of gasoline — strengthens to the point it’s trading at par with heating oil.
Why refinery shutdowns matter
Last Friday, what many in the energy market had long suspected might happen, happened.
Valero, the largest independent refiner in the US, was forced to close another 200,000-plus barrel-per-day refinery — this time,
Vitol’s energy asset grab
The problems facing independent refiners refuse to go away, so it shouldn’t be a surprise that Europe’s largest independent refiner Petroplus last week agreed to sell its Antwerp refinery’s processing facilities in a bid to raise much needed cash.
Distillate weakness driving gasoline strength
Francisco Blanch, commodities strategist at Merrill Lynch, observes in a recent note to what extent the distillate overhang has now ironically become the primary driver of gasoline strength, and to what degree refineries are switching over to gasoline-max mode to try and make-up for the shortfall:
Just how big a problem is falling capacity utilisation?
Former commodity mega-bulls Goldman Sachs are expecting markets to continue to pull back from current levels in the near term as “fundamentals are not yet stable enough to support higher prices”, according to their latest Commodity Watch.