Oklahoma Group 3 Gasoline Basis at 1-Month High

DAVENPORT, FL (DTN) — Basis for Oklahoma Group 3 suboctane gasoline strengthened sharply Monday (2/23), lifting differentials to their highest level in more than one month as traders reported higher buying interest against limited selling.

The differential for Group 3 regular suboctane, also known as V-grade, advanced 6.25cts on the session to trade at a 14.5cts discount to March NYMEX RBOB futures, compared with a 20.75cts differential in the prior session. The move marked the strongest level since January 20, when the discount was assessed at a 15cts discount to the front-month contract, according to DTN data.

There were stronger bids for Group 3 gasoline against lighter offer-side participation, according to a person familiar with the Midwest gasoline market. That dynamic allowed discounts versus futures to narrow.

The Group 3 market often exhibits heightened volatility because it possesses a smaller refining footprint compared to the high-volume Chicago, Buckeye, and Wolverine systems.

This structural concentration means even modest shifts in buying interest can disproportionately impact basis values relative to the broader Midwest complex.

The strength in Group 3 did not extend across the broader Midwest gasoline complex.

Chicago CBOB basis, including Buckeye and Wolverine, was assessed at a 33cts discount to March NYMEX RBOB futures, weakening 1ct on the day and signaling continued softness in the Great Lakes region.

Distillate basis also softened across the Midwest. Chicago ULSD widened 3.50cts to a 17cts discount to March NYMEX ULSD futures. Buckeye ULSD weakened 2cts to a 12cts discount, in line with Wolverine ULSD, which held at a 12cts discount to the front-month ULSD futures contract.