POTENTIAL GASOLINE CARGOES FOR USWC TRACKED AT 1.9MM BBL
Valero and Noble Group are taking advantage of soaring prices for gasoline in
Los Angeles and San Francisco, chartering six tankers in Europe to take the
refined product on a rare voyage through the Panama Canal. They are likely
heading to the U.S. West Coast, where differentials have hit three-year highs
amid refinery outages that have curbed production. Valero has two tankers heading beyond the Panama Canal, each loaded with
37,000-metric ton cargoes (about 316,000 bbl), according to the OPIS Tanker Tracker, which tracks U.S.-bound gasoline tankers from Europe to the U.S. in real time. Noble has the remaining four ships, according to information compiled from market intelligence, traders, brokers and satellite-tracking data.
The moves can potentially bring 1.9 million bbl to the West Coast between May 7 and May 18 based on the vessels' positions, data shows. An ExxonMobil-controlled tanker, UACC Doha, that loaded a gasoline cargo in France on April 23 is also signaling it will be heading to Everett on the West Coast, but this could not be confirmed. Gasoline is normally shipped to the U.S. Northeast from Europe, with voyages through the Panama Canal and around to the West Coast or South America rarely taken. As of presstime, West Coast CARBOB 5.99 RVP was valued at more than $2.77/gal in Los Angeles, and $2.68/gal in San Francisco, while at the same time, EuroBOB was trading at $1.9351/gal. Those price levels left the Europe-to-USWC arbitrage (profit) window wide open. The shipments would be the first seen since March, when gasoline and components were last imported into the region from the Amsterdam-Rotterdam-Antwerp trading hub. The March cargoes were said to be the first arbitrage cargoes in five years to the West Coast.
The Valero-controlled Energy Progress was signaling it will arrive in Los Angeles within nine days, while the U.S. refiner also had the Lefkara heading for the Panama Canal. The vessel's final destination wasn't signaled. Noble-controlled Overseas Ambermar, Nina, Mare di Genova and STI Hackney were also heading for the Panama Canal or making the transit after crossing the Atlantic. The Mare di Genova, which initially signaled its destination as Los Angeles, then said it's heading for Ecuador, though this could change depending on arbitrage economics.
Cash differentials for Los Angeles and San Francisco traded at three-year highs Wednesday, according to OPIS data, amid lower production from ExxonMobil's Torrance refinery and other turnarounds.