NEW YORK, May 26 - Gasoline cash values are likely to find some strength near-term from higher U.S. summer driving season demand and lower supply due to refinery outages, traders and analysts said on Tuesday.
Cash values in the U.S. Gulf Coast kicked off the short trading week on a strong note as traders returned from Memorial Day holiday, seen as the start of the season when millions of Americans take to the road for vacation travel.
"Supplies in key markets areas are low and summer demand is picking up," said Stephen Schork, editor of the Schork Report, in Philadelphia, Pennsylvania, who sees a bullish trend.
According to last Wednesday's Energy Information Administration (EIA) weekly report, U.S. gasoline stocks fell 4.3 million barrels to 204 million barrels in the May 15 week, leaving gasoline stocks down by 13.4 million barrels over the last four weeks, Schork noted.
"More importantly, stocks on both coasts are low. In the East (PADD I) stocks, 53.7 million barrels are 7.6 percent below a year ago ..." Schork added in a report on Tuesday.
In the Gulf Coast, PADD III, motor fuel inventories fell to 70.1 million barrels that week from 71.3 million the previous week while Midwest supplies were also lower over the same period, at 47.6 million versus 49.3 million, the data shows.
A preliminary Reuters poll of industry analysts Tuesday indicates they expect new EIA oil statistics due Thursday to show the nation's total stockpile of motor fuel shrank further last week, off by an average 1.8 million barrels. [EIA/S]
The analysts expect U.S. distillates stocks rose 900,000 barrels while crude oil supplies fell 1.1 million barrels.
Late last week, traders talked of market expectations of further economic run cuts by domestic refiners, with Citgo's massive 429,500 barrel per day refinery in Lake Charles, Louisiana seen as the latest plant to cut back output. A spokesman has said he was unable to comment on operations.
Sunoco Inc. (SUN.N) said on Tuesday it will not provide any more daily updates on its 178,000 bpd Marcus Hook, Pennsylvania, refinery which had shut a gasoline-making fluid catalytic cracker after a recent fire in an ethylene unit.
Valero Energy Corp's (VLO.N) 210,000-barrel-per-day refinery in Delaware City, Delaware, will continue to run at reduced rates until the coking unit returns to service at the end of May, a spokesman has said. [ID:nN20524684]
"There is no change in the status of the coker at Delaware City," Valero spokesman Bill Day said in an email Tuesday.
Meanwhile, processing units at Valero's McKee refinery in Texas will restart late this week or early next week after maintenance, industry sources said. [ID:nN26485769] Exxon Mobil Corp (XOM.N) said it expects little impact from a Friday coker malfunction to production at its 348,500 bpd Beaumont, Texas, refinery. [ID:nN22394173]
HIGHER IMPORTS
Helping somewhat mitigate the price pressure from lower stocks, analysts expect a further gain in imports after the most recent EIA data showed that U.S. imports of motor fuel rose to 938,000 barrels per day in the week to May 15 from 747,000 bpd in the prior week.
A Gulf Coast-based market watcher said on Tuesday that conventional grade gasoline basis was pressured in the New York Harbor ahead of the Memorial Day holiday weekend "on news that there would be increasingly more cargoes headed from Northwestern Europe" to the United States.
On the distillates front, New York Harbor traders said the week ahead will be devoted mostly to cleaning-up of positions ahead of Friday's expiry of the benchmark June heating oil futures. On Tuesday, the new July screen benchmark was trading 2.45 cent higher than June.
"There's plenty of products and the screen lets you roll forward, so it will be a matter of who does not have room to hold (barrels)," a New York Harbor distillates trader said.
Cash values in the U.S. Gulf Coast kicked off the short trading week on a strong note as traders returned from Memorial Day holiday, seen as the start of the season when millions of Americans take to the road for vacation travel.
"Supplies in key markets areas are low and summer demand is picking up," said Stephen Schork, editor of the Schork Report, in Philadelphia, Pennsylvania, who sees a bullish trend.
According to last Wednesday's Energy Information Administration (EIA) weekly report, U.S. gasoline stocks fell 4.3 million barrels to 204 million barrels in the May 15 week, leaving gasoline stocks down by 13.4 million barrels over the last four weeks, Schork noted.
"More importantly, stocks on both coasts are low. In the East (PADD I) stocks, 53.7 million barrels are 7.6 percent below a year ago ..." Schork added in a report on Tuesday.
In the Gulf Coast, PADD III, motor fuel inventories fell to 70.1 million barrels that week from 71.3 million the previous week while Midwest supplies were also lower over the same period, at 47.6 million versus 49.3 million, the data shows.
A preliminary Reuters poll of industry analysts Tuesday indicates they expect new EIA oil statistics due Thursday to show the nation's total stockpile of motor fuel shrank further last week, off by an average 1.8 million barrels. [EIA/S]
The analysts expect U.S. distillates stocks rose 900,000 barrels while crude oil supplies fell 1.1 million barrels.
Late last week, traders talked of market expectations of further economic run cuts by domestic refiners, with Citgo's massive 429,500 barrel per day refinery in Lake Charles, Louisiana seen as the latest plant to cut back output. A spokesman has said he was unable to comment on operations.
Sunoco Inc. (SUN.N) said on Tuesday it will not provide any more daily updates on its 178,000 bpd Marcus Hook, Pennsylvania, refinery which had shut a gasoline-making fluid catalytic cracker after a recent fire in an ethylene unit.
Valero Energy Corp's (VLO.N) 210,000-barrel-per-day refinery in Delaware City, Delaware, will continue to run at reduced rates until the coking unit returns to service at the end of May, a spokesman has said. [ID:nN20524684]
"There is no change in the status of the coker at Delaware City," Valero spokesman Bill Day said in an email Tuesday.
Meanwhile, processing units at Valero's McKee refinery in Texas will restart late this week or early next week after maintenance, industry sources said. [ID:nN26485769] Exxon Mobil Corp (XOM.N) said it expects little impact from a Friday coker malfunction to production at its 348,500 bpd Beaumont, Texas, refinery. [ID:nN22394173]
HIGHER IMPORTS
Helping somewhat mitigate the price pressure from lower stocks, analysts expect a further gain in imports after the most recent EIA data showed that U.S. imports of motor fuel rose to 938,000 barrels per day in the week to May 15 from 747,000 bpd in the prior week.
A Gulf Coast-based market watcher said on Tuesday that conventional grade gasoline basis was pressured in the New York Harbor ahead of the Memorial Day holiday weekend "on news that there would be increasingly more cargoes headed from Northwestern Europe" to the United States.
On the distillates front, New York Harbor traders said the week ahead will be devoted mostly to cleaning-up of positions ahead of Friday's expiry of the benchmark June heating oil futures. On Tuesday, the new July screen benchmark was trading 2.45 cent higher than June.
"There's plenty of products and the screen lets you roll forward, so it will be a matter of who does not have room to hold (barrels)," a New York Harbor distillates trader said.
