MARKETWIRE ALERTS


   
   MARKETWIRE ALERTS 

   MarketWire Afternoon News June 29th:

   Updated at 5:00 PM ET 

    

   HEADLINES:

   -- PNW Sub Octane Basis Jumps 11cts Amid Imports Squeeze

   -- EIA: U.S. Refining Capacity Begins 2026 at 2-Year Low

    

   NEWS:

    

   PNW Sub Octane Basis Jumps 11cts Amid Imports Squeeze

   Pacific Northwest sub octane regular gasoline basis strengthened Monday 
(6/29), rising 11cts as slumping regional imports drew aggressive bidding into 
the market despite comfortable overall inventory levels.

   A bid was heard at a 12cts premium to August NYMEX RBOB futures, bringing 
the Pacific Northwest sub octane basis to a current indication of a 12.5cts 
premium. That is up 11cts from Friday's (6/26) last assessed premium of 1.5cts.

   The change occurred despite a lack of confirmed refinery flaring events or 
major unplanned outages on the West Coast, which has helped keep broader 
regional supply concerns in check.

   Latest inventory data from the U.S. Energy Information Administration showed 
motor gasoline inventories in the PADD 5 region extended their gains for a 
fifth consecutive week. Stocks climbed by 900,000 bbl to 28.9 million bbl 
during the week ended June 19 from 28 million bbl the previous week. Year on 
year, gasoline stocks were 200,000 bbl higher.

   PADD 5 gasoline imports fell by 28,000 bpd to 68,000 bpd last week and were 
77,000 bpd lower than the same week last year.

    

   EIA: U.S. Refining Capacity Begins 2026 at 2-Year Low

   U.S. oil refining capacity dropped by more than 250,000 bpd last year to 
18.2 million bpd at the start of 2026, hitting its lowest point in two years, 
the U.S. Energy Information Administration said in a report published Monday 
(6/29).

   The capacity drop, following the 2025 closure of LyondellBasell's Houston 
plant and Phillips 66's Los Angeles facility, bumped down U.S. refining 
capacity by 1%, according to the EIA.

   But the agency also noted that the 130 refineries that remain in operation 
across the country could offset to an extent the deficit from those closures. 
This was underscored by the absolute 400,000 bpd shortfall from the combined 
shuttering of the LyondellBasell and Phillips 66 operations, which was later 
mitigated by 150,000 bpd in capacity upgrades elsewhere.

   Notwithstanding those adjustments, the loss of the Los Angeles facility 
particularly leaves the West Coast vulnerable to supply disruptions because the 
region is structurally isolated from major Gulf Coast pipelines. Consequently, 
regional market participants must rely more heavily on localized production and 
increased waterborne imports of refined products to balance West Coast 
transportation fuel demand.

   Also, the tightening of regional production capacity inherently increases 
structural price volatility whenever the remaining West Coast refineries 
undergo scheduled seasonal maintenance or unexpected operational downtime. 
Market risks could amplify with the winding down of Valero's 145,000 bpd 
Benicia facility, which began in February.
Combined, Phillips 66's Los Angeles refinery and Valero's 145,000 bpd Benicia 
facility accounted for 10% of West Coast refining capacity in 2024.

    




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