Oil trades near 3-day high as re­finer­ies re­sume

The Pak Banker - - Front Page -

NEW YORK

Oil traded near the high­est level in three days in New York as U.S. East Coast re­finer­ies re­sumed op­er­a­tions in the af­ter­math of At­lantic su­per­storm Sandy, in­creas­ing crude de­mand.

West Texas In­ter­me­di­ate fu­tures were lit­tle changed af­ter ris­ing 0.7 per­cent yes­ter­day.

East Coast re­finer­ies ac­count­ing for 76 per­cent of the 1.29 mil­lion bar­rels a day of ca­pac­ity in Sandy's path have re­stored op­er­a­tions or are in the process of do­ing so. Price gains stalled be­fore an En­ergy Depart­ment re­port to­day that may show U.S. crude stock­piles rose to the high­est level in three months ahead of the storm.

"Re­finer­ies are get­ting back on­line quickly, so clearly that is go­ing to re­move some of that con­cern about a tem­po­rary over­sup­ply," said Michael McCarthy, a chief mar­ket strate­gist at CMC Mar­kets in Sydney. "I'm ex­pect­ing fur­ther pres­sure on prices in the next week or so from in­ven­tory builds."

Crude for De­cem­ber de­liv­ery was at $86.32 a bar­rel in elec­tronic trad­ing on the New York Mer­can­tile Ex­change, up 8 cents, at 9:34 a.m. in Lon­don. Prices gained 56 cents yes­ter­day to $86.24, the high­est close since Oct. 26. Fu­tures are down 13 per­cent this year.

Brent oil for De­cem­ber set­tle­ment on the Lon­don­based ICE Fu­tures Europe ex­change was at $108.44 a bar­rel, down 26 cents. The con­tract ear­lier dropped as much as 0.5 per­cent and has fallen the past three days. The Euro­pean bench­mark crude was at a $22.15 pre­mium to WTI, from $22.46 yes­ter­day.

"Ex­pec­ta­tions of a quick re­fin­ing come­back seem to be jus­ti­fied, and you may ul­ti­mately see de­mand in the U.S. North­east af­fected more than sup­ply," Tor­b­jo­ern Kjus, a se­nior oil an­a­lyst at DNB ASA in Oslo, said by phone.

PBF En­ergy Inc.' s Delaware City, Delaware, and Pauls­boro, New Jersey, re­finer­ies were oper­at­ing nor­mally yes­ter­day, ac­cord­ing to recorded community hot­line mes­sages. The plants, with a com­bined ca­pac­ity of 367,200 bar­rels a day, ran at re­duced rates throughout the storm.

NuS­tar En­ergy LP (NS)'s 74,000 bar­rel-a-day Pauls­boro as­phalt fa­cil­ity in New Jersey was re­turn­ing to ser­vice and is expected to be back to full pro­duc­tion by to­day, ac­cord­ing to a state­ment posted on the com­pany's web­site Oct. 30.

Delta Air Lines Inc.'s Mon­roe En­ergy LLC 185,000 bar­rel- a- day Trainer, Penn­syl­va­nia, re­fin­ery was oper­at­ing nor­mally, the En­ergy Depart­ment said yes­ter­day. Tre­bor Banstet­ter, an At­lantabased spokesman for Mon­roe, didn't re­spond to an e-mail about the sta­tus of the plant.

Restarts in New Jersey at Phillips 66's 238,000 bar­rel-aday Bay­way plant in Lin­den and Hess Corp. 70,000 bar­rela-day Port Read­ing fa­cil­ity are con­tin­gent on post-storm as­sess­ments, the com­pa­nies said Oct. 30. Phillips re­ported flood­ing at Lin­den and said yes­ter­day the re­fin­ery re­gained power.

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