Los Angeles jet fuel hit its lowest differential in 11 months Wednesday as new data showed a large stock build mostly due to a nearly five-year high for weekly imports.
Platts assessed Los Angeles jet fuel down about 3 cents to the December NYMEX heating oil contract plus 1.25 cents/gal, based on an offer heard at plus 1.50 cents/gal. It was the lowest assessment since November 15, 2011, when it was plus 0.75 cent/gal.
NYMEX December heating oil was assessed by Platts at 3:15 p.m. EDT at $3.0251/gal, or 18 points lower than Tuesday. Los Angeles jet fuel had an outright price of $3.0276, which was the lowest assessment since $3.0043/gal on August 6 ahead of a crude unit fire later that day at Chevron's Richmond refinery near San Francisco.
US Energy Information Administration data released early Wednesday showed 152,000 b/d of jet fuel arrived into the West Coast region for the week ending October 19. Jet fuel production dropped 15,000 b/d to 368,000 b/d, the lowest level since mid-May, but stocks rose a sharp 1.658 million barrels to 11 million barrels, a high since July 22, 2011, the data showed.
EIA data has showed higher-than-normal import activity in the region since mid-August, with the 152,000 b/d last week being the highest since 156,000 b/d for the final week of November 2007. The past four weeks have seen 2.65 million barrels of jet fuel enter the West Coast.
"Inventories rose to 11 million (barrels) mostly because of imports," a trader said. "It's a reflection of how much lost jet production there is from Chevron."
Sources and Platts vessel-tracking software cTrack showed the influx has almost run its course, with little activity beyond the latest wave of imports.
Last week's data likely included the Cape Texel, an LR1-sized vessel capable of carrying 600,000 barrels, as well as the smaller MR-sized FPMC 30 and maybe one more MR or a partial cargo. Two or three more vessels just unloaded or were unloading in the West Coast.
Sources and cTrack showed only a few more candidate en route, including the FPMC 26 for Phillips 66 from Malacca arriving November 1, and Eastern Force from South Korea set to arrive November 4 for Chevron Richmond.
