LA Jet Fuel Basis Eases to 55cts After Market Rally

MIAMI, FL (DTN) -Basis for prompt Los Angeles jet fuel fell by 10cts Thursday (3/5) to a 55ct premium above April NYMEX ULSD futures after surging to a 65ct premium in the previous session.

The pullback follows a sharp upward trend that began March 3, when LA jet fuel basis climbed by 26.5cts to a 42.5cts premium over the ULSD contract before jumping another 22.5cts on Wednesday (3/4).

Domestic supply tightness also supported spot market prices as refining utilization in the West Coast region decreased to 79.6% in the week ending February 27, down from 81.1% the previous week.

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