LA Jet Fuel Basis Jumps 26.5cts on ULSD Rally

MIAMI, FL (DTN) — Basis for prompt Los Angeles Jet fuel surged by 26.5cts on Tuesday (3/2) to a 42.5cts premium over April NYMEX ULSD futures, following a rally in futures market that lifted ULSD.

Domestic supply tightness also supported spot market prices as refining utilization in the West Coast (PADD 5) dropped to 81.1% in the week ending February 20 from 87.4% the prior week, according to most recent data from Energy Information Administration.

Lower refining rates in PADD 5 reflect the recent closure of Phillips 139,000 bpd Los Angeles, California, refinery and the upcoming shutdown of Valero’s 145,000 bpd, Benicia California, refinery, with operations set to cease in late April.