US fuel ex­ports re­cover af­ter Har­vey

Euro­pean, Latin Amer­i­can buy­ers relieved over re­vival

Global Times - - Biz Markets -

Fuel ex­ports from the US Gulf Coast have surged as re­finer­ies re­cover from weeks of dis­rup­tions due to Hur­ri­cane Har­vey, of­fer­ing respite to buy­ers in Latin Amer­ica and Europe.

The grad­ual re­sump­tion of op­er­a­tions in the re­gion that has be­come a ma­jor oil ex­port hub has prompted a drop on both sides of the At­lantic in bench­mark gaso­line and diesel re­fin­ing mar­gins, which mea­sure profit from con­vert­ing crude into fu­els.

Mex­ico’s state-run oil com­pany Pe­mex bought gaso­line from US Gulf Coast sup­pli­ers this week, ac­cord­ing to shipping data. Mex­ico, which im­ports half of its gaso­line, typ­i­cally buys two car­goes of the fuel per day, mostly from the US Gulf Coast.

US out­ages came at a dif­fi­cult time for Mex­ico as one of its re­finer­ies, the 190,000 bar­rels per day (bpd) Ci­u­dad Madero, was un­der­go­ing main­te­nance. Pe­mex’s largest re­fin­ery, the 330,000 bpd Salina Cruz, was also halted af­ter an earth­quake dam­aged its elec­tric sys­tem.

Salina Cruz was ex­pected to restart by the third week of Oc­to­ber.

Sim­i­larly, diesel and gaso­line ex­ports from the Gulf Coast to Brazil were slowly re­cov­er­ing. Also, shipping data showed that about 10 tankers car­ry­ing US diesel have also been booked to sail to Europe this week.

That fol­lowed around three weeks of al­most no ac­tiv­ity on the transat­lantic route, a vi­tal source of sup­ply for Europe.

“Slowly but surely, ex­ports from the US Gulf are com­ing back as more re­fin­ing ca­pac­ity re­turns,” a Euro­pean trader said.

US re­finer­ies in­creased crude runs last week by 1 mil­lion bpd to 88.6 per­cent of to­tal ca­pac­ity, the high­est rate since Har­vey hit on Au­gust 25, ac­cord­ing to weekly data from the En­ergy In­for­ma­tion Ad­min­is­tra­tion (EIA).

The US Gulf Coast has in re­cent years be­come a ma­jor re­fined prod­uct ex­port hub, shipping nearly 2.7 mil­lion bpd of gaso­line, diesel and other fu­els in May this year.

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