21 December 2011 00:20 [Source: ICIS news]
HOUSTON (ICIS)--US Gulf heavy naphtha prices surged by 7.50 cents/gal on after a major refinery reduced production as a result of a mechanical issue, and on a sharp increase in gasoline futures, market sources said on Tuesday.
The spot price of heavy naphtha was assessed at $2.52-2.53/gal on Tuesday.
Marathon sold full-range naphtha to ExxonMobil’s 560,640 bbl/day Baytown refinery in Texas at a higher premium to spot gasoline, a market broker said.
The ExxonMobil refinery reported a hole in a naphtha draw line, which was discovered on 17 December, resulting in a loss of naphtha production, according to a regulatory filing with the the Texas Commission on Environmental Quality (TCEQ).
ExxonMobil could not be reached immediately for comment regarding the status of production.
As a result of the ExxonMobil purchase from Marathon, heavy naphtha was assessed at a premium of 1.25 cents/gal over spot Gulf coast gasoline.
In addition to the spot naphtha premium strengthening, gasoline futures surged by 8.96 cents/gal for a gasoline settlement of $2.5787/gal. This caused a surge in spot gasoline, and naphtha traded at a premium to spot gasoline.
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