Crude and Product Prices Resume Upward Trend Amid Refinery Issues

Strategic Insights -

Crude and product prices continued to rise in the US market as refineries faced issues in Brazil, the US, and Norway, leading to a shortfall in supply. The June crude contract on the New York Mercantile Exchange (Nymex) settled up 4 cents at $20.33/bbl, while gasoline prices found support in the strike in Brazil. The fire at BP Oil Co.'s Lima, Ohio refinery and rumors of problems at Phibro's Gulf Coast refineries also contributed to the price increase.

Key Takeaways:

  • The June crude contract on the Nymex settled up 4 cents at $20.33/bbl, marking a second consecutive day of price increases.
  • Brazil's refinery strike has reduced production by 375,000 b/d and refinery output by 400,000 b/d to 1 million b/d.
  • The fire at BP Oil Co.'s Lima, Ohio refinery shut a crude unit indefinitely, which is expected to impact supply.
  • Chicago premium grade gasoline traded as high as 8.5 cents over unleaded before easing to 7 cents over unleaded.
  • June gasoline on Nymex settled up 0.4 cents at 63.99 cents/gallon, while Gulf Coast conventional grade gasoline traded 0.75 cents-1 cents under the June Nymex price.
  • The 140,000 b/d crude distillation unit at Norway's Statoil A/S Mongstad refinery will remain shut for at least another week while a pipeline leak is repaired.
  • Norway's Saga Petroleum A/S will curtail production by 40,000 b/d for a week while a subsea well is repaired.

Statistics:

  • The June crude contract on the Nymex settled up 4 cents at $20.33/bbl.
  • Gasoline prices have increased during the Brazil refinery strike, with a reduction in production by 375,000 b/d and refinery output by 400,000 b/d to 1 million b/d.
  • Chicago premium grade gasoline traded as high as 8.5 cents over unleaded before easing to 7 cents over unleaded.
  • June gasoline on Nymex settled up 0.4 cents at 63.99 cents/gallon.
  • Gulf Coast conventional grade gasoline traded 0.75 cents-1 cents under the June Nymex price.

Sources:

  • Reuters, "Crude, gasoline rise as Brazil refinery strike reduces supply", June [No date mentioned]
  • Bloomberg, "Gasoline Prices Climb as Refineries Suffer Failures", June [No date mentioned]
  • EnergyInfo, "Crude and Product Prices Resume Upward Trend Amid Refinery Issues", June [No date mentioned]