Slide 13 of 15
Notes:
- But there is some room for hope.
- Refineries generally begin maintenance in February or March, and finish in April. The East Coast was experiencing some lengthy refinery maintenance outages, as shown by the drop in utilization that remained low in most of March and April.
- In the meantime, the East Coast was drawing on extra supplies from the Gulf Coast and imports.
- The Midwest refineries seem to have been ramping up in April as they finished what maintenance was needed. But the Midwest no longer has the Blue Island refinery, so it also is pulling more product from the Gulf Coast.
- The high Gulf Coast prices this spring reflect extra “pull” on product from both the Midwest and the East Coast, and probably from California as well. Inputs into Gulf Coast refineries over the last 4 weeks have been over 600 thousand barrels per day (nearly 9%) more than last year during the same period. This reflects the extra demand for product from the Midwest and East Coast.
- The weekly data indicates the East Coast refineries are coming back up, which, should free up some Gulf Coast capacity to fill in for the Tosco refinery problem that occurred a week and a half ago. With the spreads between gasoline and crude oil spot prices that we are seeing, it’s no surprise that refinery utilization is up.
