LA Jet Fuel Basis Slides by 15cts on Low Availability

MIAMI, FL (DTN) – The basis for prompt Los Angeles jet fuel weakened for the second consecutive session Friday (5/1), slipping by 15cts to a 60cts premium above June NYMEX ULSD futures, extending the market’s retreat from last week’s record highs.
Jet fuel extended losses after Thursday’s drop drove prices down by 15cts to a 75cts premium above June ULSD futures, reversing a brief rebound earlier in the week that had lifted the basis to a 95cts premium. Los Angeles jet fuel had climbed to a record $1.10 gallon premium last week before the rally lost momentum.
Los Angeles diesel traded at a 13ct premium to June NYMEX ULSD futures, down by 12cts on the session, signaling softer strength across the middle distillate complex.
Despite the recent pullback, traders continue to cite constrained refining capacity as the underlying driver, with the shutdown of Phillips 66’s 139,000 bpd Los Angeles refinery and the planned closure of Valero’s 145,000 bpd Benicia refinery tightening supply across the West Coast system.