Hovensa shuts down fluid catalytic cracker in Caribbean

26 October 2009 21:32  [Source: ICIS news]

HOUSTON (ICIS news)--Caribbean refiner Hovensa said on Monday that it has shut down a fluid catalytic cracker (FCC) at its 550,000 bbl/day refinery in the US Virgin Islands, causing a spike in US cash gasoline differentials.

The 150,000 bbl/day gasoline-producing unit in St Croix was taken down for unplanned maintenance and is scheduled to restart on 6 November, according to Hovensa spokesman Alex Moorhead.

He did not disclose a reason for the maintenance or when the outage began.

New York Harbor (NYH) regular unleaded cash gasoline differentials were heard at 3.50 cents over the November reformulated gasoline blendstock for oxygenate blending (RBOB) contracts on the NYMEX.

The differential strengthened by 1 cent today and put cash M-grade gasoline prices at $2.0675-2.0700, steady with Friday despite the drop in futures prices, according to data from ICIS pricing

The outage in St Croix did not affect RBOB futures as November contracts finished the day at a 1.00-cent loss versus Friday at $2.0338/gal.

One NYH gasoline trader said the market's reaction to the shutdown started on Friday.

A US Gulf (USG) coast trader attributed the uptick in gasoline margins to the Hovensa news.

The gasoline crack spread was assessed at $6.74/bbl, an increase of $1.40 from $5.34/bbl on Friday.

The USG differential for M4 regular gasoline was up by 0.65 cent to 3.00 cents under the December RBOB futures benchmark.

The Hovensa refinery in the US Virgin Islands is a joint venture between Venezuelan state-run energy company PDVSA and US refiner Hess.

Cash gasoline prices are an important bellwether for petrochemical pricing along the aromatics chain.

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By: Ryan Hickman
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