Analysis by Dr. Nancy Yamaguchi

 

The Energy Information Administration (EIA) released its weekly data on diesel and gasoline retail prices for the week ended February 27, 2017. Prices for both fuels rose during the week.

 

For the current week ended February 27, diesel prices rose 0.5 cents (cts) to an average price of $2.577/gallon.

 

PADD 1 retail diesel prices rose 0.7cts to $2.635/gallon. In New England, prices were flat at $2.658/gallon. Central Atlantic diesel prices edged up by 0.2cts to average $2.772/gallon. Lower Atlantic prices rose by 1.2cts to average $2.533/gallon. Overall PADD 1 prices were 58.1cts/gallon above their prices for the same week last year.

 

In the Midwest PADD 2 market, retail diesel prices rose 0.4cts to average $2.499/gallon. This price was 56.2cts/gallon above its level for the same week last year.

 

In the Gulf Coast PADD 3, retail diesel prices were unchanged at $2.433/gallon. This price was 55.9cts higher than in the previous year. Motiva announced that it would be shutting down its hydrocracker and cutting crude runs at its 230 kbpd Convent, Louisiana, refinery, for a period of around four weeks. This is to finalize repairs on a fire-damaged section that has been closed since August. Valero’s 125 kbpd Meraux, Louisiana, refinery and 47 kbpd hydrocracker remain at low throughput during repairs after a fire and explosion.

 

In the Rocky Mountains PADD 4 market, retail diesel prices jumped 3.4cts to $2.582/gallon. This price was 70.1cts higher than in the prior year. Plains All American Pipeline closed its Wahsatch Pipeline, reportedly because of a landslide in Utah. The line is expected to remain closed during the current week. Crude supplies have been constrained, notably to Tesoro’s 63 kbpd refinery and HollyFrontier’s 45 kbpd refinery in the Salt Lake City area, which are having supplemental crude supplies delivered by truck. Tesoro’s refinery had already been in planned maintenance last week, so the pipeline closure had less impact on supply than it might have had otherwise. Chevron’s 45 kbpd refinery is said to be unaffected.

 

In the West Coast PADD 5 market, diesel pump prices increased slightly by 0.1cts to $2.877/gallon. This price was 68.6cts above its level last year. Prices excluding California rose 0.5cts to $2.772/gallon, which was 71.8cts above the retail price for the same week last year. California diesel prices, in contrast, declined by 0.4cts to an average price of $2.962/gallon, 66cts higher than last year’s price. Prices were influenced by downtime at one of the hydrocrackers (20 kbpd capacity) at the 77 kbpd Phillips 66 Rodeo refinery near San Francisco. Tesoro began to restart the coker at its Wilmington, California, refinery at reduced rates because of a mechanical failure. PBF Energy’s Torrance refinery remains at reduced throughput. Note that the Torrance refinery was mistakenly reported as having been restarted this week, which may cause price anomalies in next week’s price report.

 

 

U.S. retail gasoline prices increased by 1.2cts for the week ended February 27, to $2.314/gallon. This price was 53.1cts higher than for the same week in 2016.

 

In the East Coast PADD 1, prices for gasoline declined 0.8cts to $2.286/gallon. This price was 54.8cts higher than last year’s price. Prices dropped 1.6cts in New England to $2.272/gallon. Central Atlantic market prices fell by 2.4cts to $2.396/gallon. Prices in the Lower Atlantic market increased by 0.6cts to bring prices to an average of $2.207/gallon, 52.6cts higher than last year’s average price. PBF Energy reopened the 55 kbpd coker at its Delaware City, Delaware, refinery, which had been out of service since January 12. PBF is in the process of restarting its 44 kbpd cat reformer and related hydrotreaters. Philadelphia Energy Solutions has had gasoline-related units offline.

 

 

In the Midwest PADD 2 market, gasoline prices rose by 2.0cts to average $2.21/gallon. Gasoline pump prices were 48.8cts higher than they were one year ago.

 

In the Gulf Coast PADD 3 market, gasoline prices were unchanged at $2.069/gallon. Prices for the week were 51cts higher than for the same week in 2016. The FCC at Chevron’s 325 kbpd Pascagoula, Mississippi, refinery was down for unplanned repairs. Phillips 66 began a restart of the larger (45 kbpd) of its two cat crackers at the 200 kbpd Ponca City, Oklahoma, refinery. Petrobras is delayed in restarting the 56 kbpd cat cracker at the Pasadena, Texas, refinery.

 

In the Rocky Mountains PADD 4 region, gasoline prices rose 2.1cts to average $2.273/gallon. This price was 57.1cts higher than at the same time in 2016. Supplies have been constrained by the closure of Plains All-American Pipeline’s 100,000 bpd Wasatch Pipeline. Tesoro and HollyFrontier reduced throughput at their Salt Lake City refineries.

 

In the West Coast PADD 5 market, retail gasoline prices jumped 4.6cts to an average price of $2.796/gallon. This was 58.8cts higher than at the same time a year ago. Excluding California, prices rose 2.6cts to an average of $2.522/gallon. This was 65.7cts higher than at the same time in 2016.

 

California saw a price hike of 5.8cts to an average pump price of $2.956/gallon, 55cts higher than last year’s price for the same week. Los Angeles prices soared 8.9cts to $3.069/gallon—the first major city where prices topped $3 per gallon. This price was 49.9cts higher than the price for the same week in 2016. San Francisco pump prices jumped by 4.7cts to average $2.965/gallon, 56.9cts above last year’s price.

 

Seattle prices increased 1.4cts to average $2.74/gallon, 68.3cts higher than prices one year ago. PBF’s Torrance refinery remains at reduced throughput in the aftermath of a fire, and these troubles are expected to persist for another week or two. Tesoro is delayed in restarting the 42 kbpd coker at the Wilmington, California refinery, though the company reported that it restarted its 17 kbpd reformer and 22 kbpd hydrocracker.