Natural gasoline on the US Gulf Coast climbed to a 15-month high Wednesday as crude futures ended the day almost 3% higher on a surprise US crude stocks draw.
Market sources said a slight uptick in demand -- for gasoline exports and diluent for Latin America -- are also supporting prices.
"I wouldn't call it a huge pickup but just enough to perk up everyone's mood regarding the spreads," a broker said.
A natural gasoline trader echoed that sentiment, noting "good buying" of Gulf Coast light naphtha for gasoline blending.
Natural gasoline, or C5, and light naphtha are similar products used for blending into gasoline or as heavy crude diluent, although natural gasoline is largely fractionated from the natural gas stream while naphtha comes from the refining process.
Non-Targa natural gasoline from the Enterprise terminal in Mont Belvieu, Texas, rose 3 cents to $1.1525/gal based on an offer at $1.1550 left standing at the end of the S&P Global Platts Market on Close assessment process.
It was last assessed higher at $1.1795 on July 2, 2015, at a $7.4/b discount to crude futures. In comparison, C5 was at a $3.2/b discount to WTI on Wednesday.
The assessment came as NYMEX WTI settled at its highest in 15 months as well. NYMEX November WTI ended the day at $51.6/b, up $1.31 on the day.
