Houston, New York Harbor Jet Fuel Basis Drop on Weak Demand

HOUSTON, TX (DTN) — The basis for jet fuel at the Houston origin of the Colonial Pipeline in the Gulf Coast spot market dipped 3cts to a 18.5 cts discount to February ULSD futures on the New York Mercantile Exchange on Tuesday (1/27), amid weak demand driven by a winter storm affecting the region.

Meanwhile, jet fuel basis in New York Harbor spot market weakened by 1 cent discount to February ULSD futures, with prices talked at a 28cts discount against the same benchmark. Basis in the New York Harbor market had drastically weakened this week, with trades slumping to over 12cts compared to Friday (1/23).

Weaker basis in PADD 1 and PADD 3 are being driven by sluggish jet fuel buying interest, as massive flight cancellations and delays have been reported in recent days due to a severe weather condition caused by an Arctic blast affecting the USGC and Atlantic coasts.