July 28, 2014
The Los Angeles jet fuel differential gained 65 points/gal Monday as a large cargo from Asia en route to Los Angeles was instead diverted to Hawaii over the weekend.
Platts assessed Los Angeles jet at NYMEX September ULSD futures minus 3 cents/gal.
Los Angeles gasoline and diesel markets, especially gasoline, also saw a boost as sources cited three refiners buying and FCC issues at Valero's refinery near San Francisco. Fluid catalytic crackers have little effect on jet fuel, but the differential could be rising in sympathy.
Platts cFlow vessel-tracking software showed that a 500,000-barrel ship halfway from South Korea to its listed destination of Los Angeles instead diverted to Honolulu, with an estimated arrival of August 1.
Sources said the ship was carrying jet fuel for Chevron, which has refineries in Los Angeles and Hawaii.
European tightness eases
European jet price differentials fell Monday amid an expected easing supply tightness over August.
CIF Northwest European cargoes were assessed at a premium of $77.25/mt to front-month ICE gasoil futures, down $3.75/mt.
There remained persistent buying interest for cargoes, with Le Havre in northern France -- one of the region's busiest ingress points -- a particular focus for bids from BP and Morgan Stanley.
The active buying interest for delivered barrels continued to hold cargoes above barges, which over the past week have lacked the demand dynamism seen through June and the earlier part of July.
With traders now firmly focused on August, easing backwardation in the jet complex reflected the improving supply picture for next month.