Refinery issues pushed the Los Angeles jet fuel differential to its highest level in a month and a half Monday.
S&P Global Platts assessed Los Angeles jet fuel up 1.25 cents/gal to the NYMEX July ULSD futures contract minus 25 points/gal, or $1.5044/gal outright. That is the highest level that differential has reached since April 26, when it was also minus 25 points/gal.
Trades at NYMEX minus 2.50 cents/gal and minus 2.25 cents/gal were reported early Monday morning, around Friday's levels when news of Chevron's 269,000 b/d refinery near Los Angeles losing power broke.
However, by mid-day the differential had come back up to trade flat to the front-month NYMEX ULSD contract. By the close of trading it was being offered flat, prompting the Platts assessment.
West Coast jet fuel sources disagreed on the cause of Monday's volatile market.
"Not sure [why]," said one source. "Heard there may have been some problems still at Chevron el Segundo."
A second source said: "Nope, the opposite. I heard the FCC started back up."
A third source said, "I guess issues at Tesoro refinery."
An unspecified unit experienced a breakdown at Tesoro's 265,000 b/d Carson, California, refinery Monday morning and caused unexpected flaring, a filing with the South Coast Air Quality Management District said.
"Tesoro has been more on the buy side than the sell side," said the first source.
Tesoro spokesman Brendan Smith said that unit upsets took place because of a power outage, but declined to provide information on the specific unit or units, citing company policy. He said no injuries or safety incidents were reported.
