LA Jet Fuel Basis Sinks by 15cts

MIAMI, FL (DTN) – Los Angeles jet fuel basis lost 15cts of its premium on Monday (10/27) after a switch in the NYMEX reference contract for RBOB.

The premium against the November RBOB contract on NYMEX was 35cts gallon on Friday (10/24) and had whittled down to 20cts in the latest session after the front-month for RBOB switched to December.

The adjustment followed two spot deals heard in the market, one at a 30cts premium and another at 20cts. The final trade on the latter marked the day’s assessed differential.

The shift reflects the continued volatility in the LA jet fuels market amid refinery disruptions across Southern California after the fire and explosions earlier this month at Chevron’s 269,000 bpd El Segundo refinery.

The resulting damage to the refinery’s Isomax unit, a key processor that converts gas oils into jet fuel and other middle distillates, and series of flaring events since has caused upheaval to refined fuels supply across the state.

Adding to regional supply concerns, PBF Energy’s 155,000 bpd Torrance refinery is scheduled to conduct planned flaring beginning October 28 at 12:01 a.m. PT and ending November 5 at 11:59 p.m., according to a regulatory filing.