The Los Angeles CARBOB differential rose 1.25 cents Wednesday despite a refinery run rate of more than 80% for the first time in two months as all producers have likely exited fall maintenance.
Platts assessed the Los Angeles gasoline grade at flat to NYMEX January RBOB futures, where the last trade was heard. San Francisco CARBOB's discount to Los Angeles CARBOB widened to 3 cents/gal compared with 2.25 cents/gal on Tuesday. Portland unleaded was assessed unchanged at minus 7 cents/gal,
The US Energy Information Administration said early Wednesday that weekly USWC utilization of refinery capacity rose 6.1 percentage points to 81.3% for the week ending December 2. It is the highest run rate since 84.9% for the last week of September, about the time a host of West Coast refiners entered turnarounds or experienced outages.
Sources said refiners have all returned or in the process of returning online. Chevron plants in Los Angeles and San Francisco, two of the West Coast's largest, were considered the last holdouts. Chevron would not comment if units returned online, but sources said it appeared so and the company last week filed flaring notices typically seen in shutdowns or restarts.
USWC gasoline production, however, declined 101,000 b/d to 1.39 million b/d and remains 113,000 b/d lower than the same week a year earlier, EIA data showed. Sources said refiners have little incentive to increase production because of poor gasoline margins.
USWC gasoline stocks rose 210,000 barrels to 28.4 million billions, but remain lower than the 30.6 million barrel weekly average over the last year, EIA data showed.
USWC distillate production was up only 2,000 b/d to 574,000 b/d, roughly in line with the same week a year ago. Distillate stocks boosted by 305,000 to 12.67 million barrels in the region, which is 6% lower than a year earlier.
"Nationwide, there's a big shift to max distillate mode," one source said. But the West Coast only saw "a modest increase in distillates and a decrease in gasoline output. Kind of odd."
The EIA even reported an unusual 36,000 b/d in diesel imports to the West Coast, or about the size of one cargo last week. It is the largest diesel import figure since late April and had a high sulfur level, EIA data showed.
"I'm surprised at the diesel import," the source said. "The arb is very much closed on diesel." Other sources agreed it is a rare high-sulfur diesel import, saying it could be needed for blending purposes or for the West Coast region states of Hawaii or Alaska.
Gasoline and jet fuel are more common import commodities for the region. EIA data showed 55,000 b/d in gasoline imports compared with 39,000 b/d the week earlier, and 11,000 b/d for jet fuel imports compared with 67,000 b/d from the week earlier.
West Coast distillate markets were little changed Wednesday.
Los Angeles jet fuel fell 1.50 cents to NYMEX January heating oil futures plus 2.75 cents/gal. The main diesel grades were each assessed a quarter-cent higher, with Los Angeles CARB diesel at minus 2 cents/gal, Los Angeles EPA (ULSD) at minus 4 cents/gal, San Francisco CARB diesel at minus 4.25 cents/gal, and Portland ULSD at minus 4.25 cents/gal.
