Midwest Oil Products Post Split Futures-related Results

    

   BURLINGTON, Vt. (DTN) -- Spot market diesel fuel in Chicago and Oklahoma 
Group 3 edged higher Wednesday fueled by a bounce in New York Mercantile 
Exchange ULSD oil futures after the U.S. Energy Information Administration 
published a bullish drawdown in middle distillate stockpiles in weekly oil data 
this morning.

   Gasoline prices took a tack lower pressured by a moderate retreat in NYMEX 
RBOB futures and prompt cash differentials. 

   Business in Midwest bulk markets was active in Chicago and thin in the Group 
this afternoon. 

   The rally in ULSD futures was accompanied by an advance in WTI futures, with 
geopolitical uncertainty trumping the increase in available domestic crude oil 
supply. RBOB paper drifted lower in response to a moderate build in nationwide 
gasoline stockpiles. 

   The 2.6 million bbl draw in distillates came on the heels of a 429,000 bpd 
boost in distillate exports and 117,000 bpd production cut. A 607,000 bpd 
plunge in implied distillate demand was reported by the EIA. 

   Commercial gasoline reserves posted an 840,000 bbl week-over-week increase 
as implied demand tumbled by 744,000 bpd. The U.S. boosted gasoline imports by 
191,000 bpd while increasing exports by 144,000 bpd. U.S. refiners reduced 
gasoline output by 318,000 bpd and refinery utilization by 1.6% to 90.8% of 
capacity last week.

   Regionally, PADD 2 supplies of gasoline fell 400,000 bbl and distillates by 
100,000 bbl. 

   Domestic supplies of crude oil increased by 2.2 million bbl that included a 
459,000 bbl build in crude storage levels at the Cushing, Oklahoma supply 
depot. 

   Crude oil imports climbed by 539,000 bpd, and the U.S. increased domestic 
crude oil exports by 161,000 bpd to a 2.331 million bpd all time high.

   U.S. crude oil production increased by 46,000 bpd to a record 10.586 million 
bpd. 

   June WTI crude oil futures posted a $0.35 advance and closed formal session 
trading at $68.05 bbl. May ULSD futures ramped up 0.84cts to $2.1360 gallon, 
and June futures climbed 0.52cts to $2.1235 gallon at settlement. May RBOB 
futures drifted down 0.52cts to $2.0897 gallon at today's regular session 
close, and the June contract fell 0.47cts to $2.0949 gallon.

   Group 3 V-grade 9.0-lb. CBOB eased 50pts in basis trading at an 11.0cts May 
futures discount that trimmed spot price by 1.02cts to $1.9797 gallon for 
prompt cycle Magellan Pipeline delivery. A-grade unleaded premium remained 
tagged at a 20.5cts regrade. 

   Chicago 9.0-lb CBOB sold for first cycle May Wolverine Pipeline specific 
delivery 8.0cts below the June RBOB futures print that pared spot price by a 
penny to $2.0149 gallon. RBOB held at an 11.0cts CBOB premium and PBOB at a 
30.0cts CBOB regrade. 

   X-grade ultra-low sulfur diesel fuel in the Group rode the futures advance 
0.84cts higher to an implied $2.1285 gallon, priced at a 0.75cts May futures 
discount for prompt Magellan Pipeline offtake. 

   Chicago ULSD climbed 1.84cts above its Tuesday DTN closing market assessment 
to $2.0885 gallon, changing hands at a 3.5cts June ULSD futures discount for 
first cycle delivery into the Buckeye Complex.

   G. Bud deGorgue, 1.802.524.1784, bud.degorgue@dtn.com, www.dtn.com. (c) 2018 
DTN. All rights reserved.