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Gasoline Margins Rise as PDVSA Plant Outages Send Cargoes South
By Aaron Clark and Paul Burkhardt Sept. 2, 2009
Sept. 1 (Bloomberg) — Gasoline refining margins strengthened as problems at a Latin American refinery shifted motor-fuel cargoes away from the U.S. to South America.
Petroleos de Venezuela SA plans to restart the gasoline- making catalytic cracker at its Isla refinery on the island of Curacao this week following an Aug. 27 power failure, a company official said yesterday.
“The biggest drivers out there are the problems going on with the Venezuelan refineries and the power outage at Isla,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. That “tends to draw gasoline cargoes down to the Caribbean to cover the shortfall.”
The premium of gasoline over crude oil, or the crack spread, based on the October futures contracts, rose about 74 cents to $6.80 a barrel. The October spread has dropped 26 percent since reaching this year’s high of $9.29 a barrel on Aug. 11.
The outage at the refinery’s power company knocked all units off line, and an attempt to restart units was halted yesterday by a second power failure.
In addition to the problems at Isla, the Amuay plant, part of the 940,000-barrel-a-day Paraguana refining complex, “has had trouble with their cat cracker,” said Lipow.
Gasoline for October delivery fell 2.77 cents, or 1.5 percent, to settle at $1.7822 a gallon on the New York Mercantile Exchange. Heating oil for October delivery slipped 4.96 cents, or 2.7 percent, to $1.7589 a gallon.
Regular gasoline at the pump, averaged nationwide, lost 0.3 cent to $2.607 a gallon, AAA, the nation’s biggest motoring organization, said today on its Web site.
To contact the reporter on this story: Aaron Clark in New York at aclark27@bloomberg.netPaul Burkhardt in New York at pburkhardt@bloomberg.net.
Last Updated: September 1, 2009 15:14 EDT
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