US gasoline prices were higher across the board Wednesday after data released by the Energy Information Administration showed the largest pull from inventories in 16 weeks.
Total gasoline stocks fell 2.25 million barrels to 256.46 million barrels last week, the largest one-week decline since the week ended October 30, according to EIA data.
As is common in gasoline markets, price increases were strongest on the West Coast, where Los Angeles CARBOB jumped 49.94 cents/gal to be assessed at $1.2021/gal, its highest price since January 29.
The increase was largely due to a change to March from February trading, which brought with it a 26.45 cents/gal spread between NYMEX RBOB futures contracts.
The contango NYMEX contract also proved bullish for the Gulf Coast, as conventional pipeline gasoline with 11.5 RVP (M3) climbed 6.4 cents/gal to NYMEX April RBOB minus 26 cents/gal. The outright price jumped 12.44 cents/gal to $1.0171/gal, the first time it has been above $1/gal since January 29.
In the Midwest, Group 3 suboctane was assessed at NYMEX March RBOB plus 7 cents/gal, up 3.50 cents/gal from Tuesday. Its outright price was assessed at $1.0826/gal, its highest price since January 5.
"[The market is] still in contango," a Midwest refined products market source said. "I guess no one is having containment problems, so the bids just go higher until someone sells. If someone can hold a barrel, there's no reason to sell."
All gasoline markets have received a boost from refinery cuts.
HollyFrontier announced Wednesday that it would reduce rates at its 102,000 b/d Navajo, New Mexico, and 138,000 b/d El Dorado, Kansas, plants because of poor economics.
HollyFrontier is the latest to join a list of refiners including Valero and PBF that have reduced rates because of bad margins.
