Group 3 ULSD Basis Gains 7cts as Midwest Distillates Firm


   
Barani Krishnan
DTN Refined Fuels Market Reporter

   SECAUCUS, NJ (DTN) -- Midwest physical distillate markets showed modest 
strength Wednesday (9/16), led by gains in Group 3 ULSD basis, even as 
inventory data showed fuel stockpiles expanding across the region.

   The differential for Group 3 ULSD advanced 7cts on the day to stand at a 1ct 
gallon discount to the October NYMEX ULSD contract.

   Across regional pipeline distribution networks, ULSD differentials traded 
mixed to lower. Chicago ULSD basis slipped 4cts to an 11cts gallon premium 
against October futures, while Buckeye Complex ULSD fell 5cts to a 10cts 
premium. Wolverine ULSD basis held unchanged at a 15cts gallon premium.

   In aviation fuels, Group 3 jet fuel basis rose 5cts to stand at a 90cts 
gallon discount to October ULSD futures, while Chicago jet fuel basis held flat 
at an 80cts gallon discount.

   The physical movements unfolded alongside building regional inventories. 
Energy Information Administration data released Wednesday showed PADD 2 
distillate fuel oil stocks rose 300,000 bbl during the week ended Sept. 11 to 
28.8 million bbl, while jet fuel inventories also grew 300,000 bbl to 28.8 
million bbl. Regional refinery crude utilization slipped 2.6 percentage points 
on the week to 99.0%.

   Underlying futures eased slightly, with October NYMEX ULSD settling down 
2.24cts, or 0.57%, at $5.2396 gallon after touching a low of $5.1227 gallon.

    




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