Hydrocarbon Processing Copying and distributing are prohibited without permission of the publisher
Email a friend
  • Please enter a maximum of 5 recipients. Use ; to separate more than one email address.



Cold air in North America leads to widespread refinery shutdowns

01.07.2014  | 

Valero Energy's Memphis refinery in Tennessee had a instruments freeze and units trip offline, a person familiar with operations said. Phillips 66 had an electrical issue at its Westlake plant in Louisiana.

Keywords:

By BARBARA POWELL
Bloomberg

Gasoline futures rose for the first time in seven days as frigid temperatures caused refinery shutdowns from Newfoundland to Louisiana.

Valero Energy's Memphis refinery in Tennessee had a instruments freeze and units trip offline, a person familiar with operations said. Similarly, Phillips 66 had an electrical issue at its Westlake plant in Louisiana, according to a regulatory filing. 

Korea National Oil Corp.’s site in Come-by-Chance, Newfoundland, is trying to restart after an island-wide power failure over the weekend, company spokeswoman Gloria Slade told CBC News.

“The concern over some of the refinery issues we’ve seen as a result of the brutally cold climate across the continent has led to buying in the refined products,” said Andrew Lebow, a senior vice president at Jefferies Bache in New York.

Gasoline for February delivery rose 2.05 cents, or 0.8%, to $2.6665/gal at 10:32 a.m. Tuesday on the New York Mercantile Exchange. Trading volume was 29% above the 100-day average.

The frigid air extends across the upper Midwest into the South and eastward to the Atlantic, said Tom Kines, a meteorologist with AccuWeather in State College, Pennsylvania. Today, New York’s high will struggle to reach 10 degrees, a day after Central Park hit 50. As of 8 a.m., it was 4 degrees in New York, breaking a record for the date set in 1896, AccuWeather said.

Extreme cold

ExxonMobil's refinery in Joliet, Illinois, had unidentified problems with process units because of extreme cold, according to a filing with the National Response Center.

“Those issues are impacting the products,” said Andy Lipow, president of Lipow Oil Associates in Houston. “There will be delays in receiving supplies. But much of it is offset by the decline in demand due to the poor weather.”

The motor fuel’s crack spread versus WTI widened 68 cents to $18.38/bbl. Gasoline’s premium to London-traded Brent crude climbed 63 cents to $5.03/bbl.

“The crack spreads are particularly strong when you have concern about supply,” said Lebow.

The average US pump price fell 0.3 cent to $3.314/gal, according to Heathrow, Florida-based AAA. Prices are 1.7 cents above a year earlier.

Ultra low sulfur diesel for February delivery advanced 1.27 cents, or 0.4%, to $2.9515/gal. Volume was 14% above the 100-day average.

Diesel’s crack spread versus West Texas Intermediate crude, a rough measure of refining profitability, widened 26 cents to $30.26/bbl. The premium over European benchmark Brent gained 20 cents to $16.90.



Have your say
  • All comments are subject to editorial review.
    All fields are compulsory.

Gustavo Torres
01.08.2014

I wonder in front of my laptop, where is the global warming? I do think, the earth is not in warming cycle, but it is preparing for become a colder rock, again, as another climate process cycle.

Related articles

FEATURED EVENT

Boxscore Database

A searchable database of project activity in the global hydrocarbon processing industry

Poll

Should the US allow exports of crude oil? (At present, US companies can export refined products derived from crude but not the raw crude itself.)


85%

15%




View previous results

Popular Searches

Please read our Term and Conditions and Privacy Policy before using the site. All material subject to strictly enforced copyright laws.
© 2013 Hydrocarbon Processing. © 2013 Gulf Publishing Company.