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U.S. West Coast gasoline imports from Europe set for record April

Tue, 16th Apr 2019 19:19

By Stephanie Kelly and Erwin Seba

NEW YORK, April 16 (Reuters) - Gasoline imports into theU.S. West Coast from Europe are set to hit a record in April asarea refinery shutdowns have tightened supplies and boostedprices, Refinitiv Eikon ship data showed on Tuesday.

Imports were on track to total 2.17 million barrels inApril, most since at least November 2015, the earliest Refinitivdata available. Most of the barrels were coming from theNetherlands. The West Coast has been affected this season byplanned and unplanned refinery shutdowns and Midwest floodspreventing ethanol from reaching California, which isgeographically isolated in terms of pipelines and energyinfrastructure.

That amount represents a roughly eightfold increase from the251,200 barrels sent in April 2018. An additional 31,800 barrelsper day (bpd) have already been fixed to sail from Europe to theWest Coast in May, according to energy intelligence companyKpler.

Tighter supplies have lifted West Coast fuel prices,encouraging imports. The state's average was $4.01 a regulargallon as of Tuesday, according to the American AutomobileAssociation, with prices in San Francisco averaging $4.09 agallon.

California's gasoline prices are currently the highest inthe nation, exceeding Hawaii's, which tend to be higher becauseof the difficulty of shipping to islands.

Wholesale prices for April-delivery gasoline that meetsCalifornia's rules to reduce air pollution sold in the LosAngeles market on Monday at 50 cents a gallon over May NYMEXgasoline futures, down about 10 cents a gallon from Friday.The RBOB futures contract on NYMEX last traded around$2.01 a gallon.

Valero Energy Corp, Exxon Mobil Corp, BP Plcand Royal Dutch Shell Plc chartered four of theeight fixtures, Refinitiv data showed.

In March, Valero began a controlled shutdown of its 145,000barrel-per-day (bpd) Benicia refinery in California.

Phillips 66 shut a crude unit at its Los Angelesrefinery after a fire in March, while BP said its 227,000 bpdCherry Point, Washington, refinery would shut for plannedmaintenance until April 13.

The shutdowns have sapped the region's gasoline inventories,which totaled 29 million barrels in the week ended April 5,lowest seasonally since 2016, U.S. Energy InformationAdministration data showed.

Inventories are also tight because California refineriesjust shifted to making summer blend gasoline, which isformulated to reduce smog during warmer weather.

March floods in the Midwest also trapped barrels of ethanolthere, causing shortages of the biofuel earlier this month,raising fuel prices out West.(Reporting by Stephanie Kelly in New York and Erwin Seba inHouston; Editing by Richard Chang)

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