LA CARBOB Basis Falls 5cts, Bucking Tight Supply


   
Kristina Davis
DTN Refined Fuels Market Reporter

   MIAMI, FL (DTN) -- Prompt Los Angeles CARBOB regular basis weakened Tuesday 
(6/9) on tight supply, despite Energy Information Administration data showing 
gasoline inventories in the U.S. West Coast region fell last week for a fourth 
consecutive week.
Los Angeles CARBOB regular traded at a 28cts premium to July NYMEX RBOB 
futures, down by 5cts from where the market was last pegged Monday (6/8), U.S. 
West Coast gasoline traders said.
Motor gasoline inventories in the PADD 5 region fell by 800,000 bbl to 27.1 
million bbl during the week ended May 29, marking the fourth consecutive weekly 
decline, the EIA's Weekly Petroleum Status Report showed. Compared with the 
same week last year, gasoline stocks were 500,000 bbl lower.
PADD 5 gasoline imports climbed by 50,000 bpd to 130,000 bpd last week but were 
37,000 bpd lower compared with the same week last year, EIA data showed.

   The weakening of the basis came as carbon compliance costs in California 
fell after environmental regulators approved a $4 billion pool of free 
allowances and $800 million in near-term relief to protect regional refining 
margins.

   Notwithstanding the slide in the basis, traders continue monitoring a 
tightening landscape for West Coast refining, following the shutdown of 
Phillips 66 Los Angeles refinery earlier this year and the phased idling of 
Valero Benicia refinery.




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