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US gasoline prices rise as fire, outages hit six refineries

February 20/2020

MOSCOW (MRC) -- US gasoline prices on Tuesday continued a week-long climb as unplanned weekend refinery outages compounded earlier shutdowns at major US Gulf Coast and East Coast plants, reported Reuters with reference to gasoline traders.

Over the weekend, four refineries in Texas and Louisiana shut units directly making gasoline or portions of it, according to refinery sources and energy industry intelligence service Genscape.

Those new outages are expected to tighten US gasoline supply as refineries prepare for planned shutdowns that typically begin in spring and prepare the plants for summer driving-season production.

The average retail price for a gallon of unleaded gasoline was USD2.45, up from USD2.33 a year ago, according to petroleum analytics firm Gas Buddy. Prices have been falling this year as inventories rose and crude oil prices slumped.

On Tuesday, unleaded gasoline futures rose 1.47%, or 2.30 cents, to USD1.6066 a gallon on the New York Mercantile Exchange. The futures are up nearly 7% since Feb. 12, when a major fire shut most of Exxon Mobil Corps Baton Rouge, Louisiana, refinery, the fifth-largest in the United States.

Exxon aims to restore production at three shut crude distillation units (CDUs) as quickly as possible and raise production on a fourth, which is operating at a minimal level, said sources familiar with operations. CDUs convert crude oil into feedstock for all other production units.

An Exxon spokesman said operations continue but declined to comment on the status of individual units.

That outage accounted for most of the increase in gasoline prices while adding to the market impact of the Feb. 7 shutdown of the gasoline-producing unit at Phillips 66s Bayway Refinery in Linden, New Jersey, the largest on the East Coast. Repairs there are expected to last until early to mid-March, according to sources familiar with plant operations.

A company spokesman said planned maintenance was underway.

Over the three-day Presidents Day holiday weekend, the gasoline-producing units at Houston-area refineries operated by LyondellBasell Industries and Chevron Corp were shut, according to refinery sources and Genscape.

Restart timelines for those units were not available from sources or the companies. Neither Chevron nor Lyondell replied to requests for comment.

Reformers, which produce octane-boosting components mixed into gasoline, also were shut at Royal Dutch Shell Plcs Convent, Louisiana, refinery and Marathon Petroleum Corps Galveston Bay Refinery in Texas City, Texas, over the weekend. Shell declined to comment on the units status. Marathon was not immediately available to comment.

Restart timelines were also unavailable for those units.

We remind that, as MRC informed before, in September 2019, ExxonMobil announced plans to spend GBP140 million over the next two years in an additional investment program at its Fife ethylene plant, which has a capacity of more than 800,000 t/y.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,093,260 tonnes in 2019, up by 6% year on year. Shipments of all PE grades increased. PE shipments rose from both domestic producers and foreign suppliers. The estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).
Author:Margaret Volkova
Tags:PP, PE, crude and gaz condensate, PP random copolymer, propylene, ethylene, petrochemistry, Exxon Mobil, Phillips 66, UK, Russia, USA.
Category:General News
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