Buckeye CBOB at 4-Yr High on Tight Stocks, Joliet Woes


   
Barani Krishnan
DTN Refined Fuels Market Reporter

   SECAUCUS, NJ (DTN) - Buckeye CBOB spot basis value climbed to a 4-year high 
on Thursday (10/22), rising 62cts to settle at $1 gallon premium to the 
November NYMEX RBOB contract. The highest since September 2022, the increase 
was driven by supply tightness and firm demand. 

   Chicago CBOB basis also faced upward pressure, rising 46cts to an 80cts 
gallon premium over November NYMEX RBOB futures, while Wolverine CBOB basis 
climbed 25cts to a 63cts gallon premium.

   Spot buying was characterized by acute physical tightness and refiner 
bidding. A Midwest fuels trader pointed to a wave of short-covering amid 
ongoing operational issues at ExxonMobil's 275,000 bpd Joliet refinery. The 
Channahon, Illinois plant processes crude oil primarily into gasoline and 
diesel fuel for Midwest markets.

   "While volume was limited, in just five or six trades on CBOB, they moved up 
a lot... in sheer market desperation," the trader told DTN.

   In the Midcontinent, Group 3 CBOB basis advanced 17cts on the session to a 
27.5cts gallon premium over November futures.

   Physical cash strength developed as Energy Information Administration (EIA) 
data showed PADD 2 motor gasoline inventories edged up just 100,000 bbl during 
the week ended October 16 to 42.3 million bbl, keeping regional supplies 
constrained at 3.5 million bbl below year-ago levels.

   On the futures front, NYMEX November RBOB futures rose $0.0560, or 1.79%, to 
end the session at $3.1765 gallon after hitting an intraday high of $3.2205 
gallon.




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