US Spot Jet Fuel Prices Fall with Down Day for ULSD Futures

    

   OAKHURST, N.J. (DTN) --- Spot jet fuel prices dropped in heartland and 
coastal trade markets Wednesday afternoon, as mixed basis met with a better 
than 3cts retreat by New York Mercantile Exchange ULSD futures. 

   Benchmark oil futures came under selling pressure from another surprise 
build in domestic crude supplies as well as falling equities amid concerns 
about economic recession.

   Energy Information Administration data released midmorning showed commercial 
crude supplies gained for a second consecutive week, up 1.6 million bbl as 
refinery utilization rates declined and imports increased in the week ended 
Aug. 9.

   The report showed distillate stocks fell 1.9 million bbl in the week 
profiled as production and imports dropped.

   NYMEX September West Texas Intermediate crude futures dropped $1.87 to 
$52.23 bbl settlement while nearby delivery-month ULSD futures shed 3.36cts to 
$1.8437 gallon settlement. 

   In the cash market, New York Harbor jet fuel basis eased 0.25cts with a deal 
at a penny futures premium for prompt Buckeye Pipeline shipment. With the drop 
on the print, spot price slid 3.61cts to $1.8537 gallon.

   At the Gulf Coast, 54-grade traded for 48th cycle Colonial Pipeline shipment 
at a 4.5cts futures discount, down 0.25cts in basis and off 3.61cts in spot 
price to $1.7987 gallon.

   Group 3 Q-grade for prompt cycle Magellan Pipeline delivery firmed 0.5cts in 
basis to trade at a 4.5cts futures premium. The loss on the print pressured 
spot price down 2.86cts to $1.8887 gallon.

   Chicago 51-grade was talked 0.5cts weaker in basis at a 3.25cts futures 
discount for second cycle August east Chicago delivery, sliding 3.86cts in spot 
price to $1.8112 gallon.

   Los Angeles August LAX pipeline jet fuel traded at 1.5cts and 1.75cts 
futures discounts, down 3.36cts to $1.8262 gallon.

   September LAX jet fuel in the L.A. basin was bid at a 1.25cts discount to 
October ULSD futures.

   Sources pegged prompt jet fuel in San Francisco and the Pacific Northwest at 
parity with the basin.

   Earlier, EIA reported domestic jet fuel supplies dropped 716,000 bbl in the 
week ended Aug. 9 to 42.028 million bbl, narrowing the year-over-year supply 
surplus from 7.6% the week prior to 3.7%.

   Data showed total jet fuel production rose 10,000 bpd to 1.938 million bpd 
last week, down 2.4% versus the corresponding week in 2018. Jet fuel imports 
rose 144,000 bpd to 239,000 bpd and implied demand jumped 206,000 bpd to 2.017 
million bpd.

   East Coast PADD 1 supply dropped 1.963 million bpd in the week ended Aug. 9 
to 9.128 million bbl, a 10-week low, while Midwest PADD 2 stocks rose 118,000 
bbl to 6.980 million bbl.

   Gulf Coast PADD 3 jet fuel inventories jumped 1.537 million bbl to 15.571 
million bbl last week, a 25-week high, and West Coast PADD V supply fell for a 
second straight week, down 484,000 bbl to 9.648 million bbl, a six-week low.

    

   Dawn Gallagher, 1.732.531.4451, dawn.galalgher@dtn.com, www.dtn.com. (c) 
2019 DTN. All rights reserved.