May 16, 2013 

 SPCC plan for Agriculture http://www.epa.gov/ceppo/web/content/spcc/spcc_ag.htm

 

Market Outlook

The sudden spike in the Group 3 gasoline basis gas now extended to an astounding 64.0 cents over the futures. This has created multiple requests for access to the nearest gulf coast, economic based rack. For many the nearest terminal is at North Little Rock, AR and there are reports of transports from as far as Kansas, Nebraska, Oklahoma and Texas coming to load at one of the five wholesale terminals. The only positive development was a closing basis dip allowing for a five-cent decrease from what had been a +69.0 cents basis premium.

Market Recap

NYMEX energy markets managed to sustain morning momentum and continued to rally settling stronger with only gasoline easing marginally off the morning highs. The WTI and distillates traded firmer from the onset today with crude at one time surging more than a dollar higher. The heating oil/distillate trade struggled to gain footing in the early morning but ultimately was pulled upward by crude and by the settle had outpaced the RBOB trading. At the settlement the RBOB had leveled its ascent but remained about one-cent stronger as buyers continue finding support from the Group’s cash basis blowout.

The nation’s largest petroleum and petrochemical production facility averted a critical labor strike action by the United Steelworkers. Exxon Mobil’s 560,000 bpd plant at Baytown, TX had faced the critical labor stoppage before reaching a new agreement that covers around 850 workers through May 2016.

The Group 3 gasoline basis continued its meteoric rise today surging another nine cents to settle at a premium of +64.0 cents above the NYMEX. The distillate basis in the Group eased to a daily gain of +35 points making the basis +6.85 cents above the board. In comparison the Gulf Coast spot gasoline basis eased a penny lower and is discounted -18.5 cents under the futures while Gulf distillates are valued a discount of five cents to the NYMEX. The Chicago gasoline basis also firmed today, gasoline gaining 16.5 cents to a basis premium of +34.50 cents above the board.

The Obama administration proposed a new plan for the regulation of hydraulic fracturing on federal lands. The plan attempts to offer producers more flexibility while still satisfying the concerns of environmental groups. The new proposal would scrap a 2012 proposal by the Dept. of the Interior.

 


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