Valero Boosts Imports of Venezuelan Oil as Sanctions Loom
U.S. refiner Valero Energy Corp this year boosted its imports of Venezuelan crude ahead of U.S. sanctions over the country's disputed presidential election and as other customers received less of the OPEC-member's exports, according to Thomson Reuters trade flows data.Venezuelan oil production has tumbled to a multi-decade low this year, cutting shipments to buyers in the United States and elsewhere and worsening a severe economic recession. Its crude exports averaged 1.19 million barrels per day (bpd) in the January-April period, 28 percent less…
Fire hits California refinery
An explosion and fire at an oil refinery in Torrance, California, on Saturday forced the partial shutdown of the plant, leading oil traders to expect a spike this week in West Coast gasoline prices. Police and the plant owner said no one was hurt in the fire, which was extinguished by local firefighters. Two years ago, a fire at the same plant led to its closure for several months and a sustained increase in West Coast gasoline prices for more than a year. After the fire on Saturday, a group of local residents worried about pollution and accidents protested at the refinery. The event had been planned to mark the anniversary of the Feb. 18, 2015 incident.
Shell Reluctant to Part with California Refinery amid Asset Sale
Royal Dutch Shell is in talks with several potential buyers for its refinery outside of San Francisco, but the Anglo-Dutch oil giant is reluctant to part with its last asset in California, three people familiar with the process say. The company is in the midst of a massive asset sale, shedding properties from Thailand to the North Sea to pay down debt following its $54 billion purchase of smaller British rival BG Group last year. Shell, Europe's largest oil company, has sold around $15 billion of assets over the past year as part of a planned $30 billion in asset sales to trim debt incurred from the transaction.
E. Coast Refiners Shun Bakken Rail Deliveries
Philadelphia Energy Solutions Inc, the largest refiner on the U.S. East Coast, will not be taking any rail deliveries of North Dakota's Bakken crude oil in June, a source familiar with delivery schedules said on Tuesday - a sign that the impending start of the Dakota Access Pipeline is upending trade flows. At its peak, PES would have routinely taken about 3 miles' worth of trains filled with Bakken oil each day. But after the $3.8 billion Dakota Access Pipeline begins interstate crude oil delivery on May 14, it will be more lucrative for producers to transport oil to refineries in the U.S. Gulf Coast.
PA Pipeline Spat Could Upend International Oil Flows
Refiners from the Midwest United States are fighting for access to a vital Pennsylvania pipeline – a move that could cripple their East Coast competitors and redraw the map for international flows of crude and fuel into coveted coastal markets. The regulatory dispute centers on a proposal by pipeline operator Buckeye Partners’ to that state's Public Utilities Commission. The plan would reverse the flow of fuels on a section of Buckeye’s 350-mile Laurel Pipeline, which currently flows from the East Coast to Pittsburgh. Because pipelines only flow in one direction…
Exxon Fined over Refinery Explosion
ExxonMobil Corp has been fined about $165,000 by U.S. regulators for safety lapses including inadequate training and equipment maintenance over an explosion that injured four workers at an aging Baton Rouge, Louisiana, refinery last year. U.S. Occupational Safety and Health Administration (OSHA) issued nine citations, several of which echo previous cautions by federal agencies at two other Exxon plants. The citations, issued in May, were seen by Reuters this month. A separate investigation by the U.S. Chemical Safety Board (CSB) is ongoing and its report on the incident is due by year-end. Exxon said it is contesting the OSHA citations and fines.
Higher-cost Crude Could Squeeze Margins at US Refiners
U.S. refiners could face a continued squeeze on profit margins in the months ahead as dwindling supplies of heavy crude from Venezuela and elsewhere are leading several to switch to higher-priced but easier-to-refine light, sweet crude. The shift also could mean higher prices for consumers in the last weeks of the summer driving season and into the fall if refiners are able to pass along those higher costs to drivers, analysts said. PBF Energy Inc, Valero Energy Corp, Phillips 66 and Marathon Petroleum Corp said in earning calls over the past two weeks they are running more light crude as a result of narrower discounts for heavy crude.
Distillates to Boost US Refiners' Bottom Line
U.S. refiners such as PBF Energy and Valero Energy are heading into the winter season on their best footing in years, as months of surprisingly robust distillate demand has eaten away at stubbornly high inventories and boosted margins. Inventories of diesel, heating oil and jet fuel are approaching their lowest seasonal levels in three years, fueling expectations among refining executives, traders and analysts that strong margins will help the bottom line for refiners through year-end. "With the distillate inventory correction at a somewhat speedier pace than gasoline…
Venezuela Ships More Oil to US in July vs June
Venezuela's PDVSA and its joint ventures last month shipped 638,325 barrels per day (bpd) of crude to the United States, a 30 percent increase over June due to larger sales of upgraded oil, according to Thomson Reuters trade flows data. Venezuelan crude output has declined this year to its lowest point in 27 years due to a lack of investment and payment delays to oil service firms, affecting exports to customers in key markets including the United States. Even though the volume of crude sent to the United States in July was larger than the previous month, it was 22 percent below the same month in 2016. The main U.S.
U.S. Midwest Refiners Profit as Harvey Hits Rivals
U.S. refiners in the Midwest will be among the biggest winners after Hurricane Harvey dealt a blow to their competitors on the U.S. Gulf Coast. Refiners such as PBF Energy and HollyFrontier that are not hit by Harvey are on course for their best quarter in two years amid fears of fuel shortages that helped push profit margins for making gasoline up as much as 21 percent on Monday <RBc1-CLc1>. The U.S. refining industry enjoyed strong margins in recent weeks and the fallout from the hurricane is likely to extend the bullish run for weeks. Midwest refiners have the added advantage of pricing their fuel based on benchmark prices in the Gulf Coast markets…
EPA Mulls Changes to Biofuels Policy
The Environmental Protection Agency is considering a change to U.S. biofuels policy that would allow exports of ethanol to count toward the country's annual biofuels volumes mandates, two sources familiar with the matter told Reuters on Wednesday. The proposal would represent a significant shift from the original mandate of the 2005 renewable fuel program, designed to increase the amount ethanol and biodiesel in the country's fuel pool while boosting the U.S. agricultural sector. The move would benefit U.S. merchant refiners like Valero and PBF Energy, who are required under the U.S.
U.S. GoM Energy Producers Evacuating Ahead of T/S Nate
Oil and natural gas producers began evacuating staff at U.S. Gulf of Mexico platforms on Thursday ahead of Tropical Storm Nate, the second storm in as many months to threaten Gulf Coast oil and refining facilities. Nate, which has already killed three people in Costa Rica, according to local authorities, is forecast to scrape past Honduras and Mexico, enter the Gulf and strengthen into a hurricane before making landfall early on Sunday in Louisiana, near several major refineries. That path takes it through an area populated by offshore oil and natural gas platforms, which pumps more than 1.6 million barrels of crude per day, about 17 percent of U.S.
Philadelphia-Area Refiners Push Biofuels Program Reform
Oil refinery workers, executives and local politicians gathered near Philadelphia on Monday to urge the White House revamp the nation's renewable fuels program, arguing the future of their plants are at stake. The U.S. renewable fuel program requires higher levels of ethanol and other biofuels to be blended into the nation's fuel pool, a requirement pitting the oil industry against the powerful farm lobby. President Donald Trump has promised corn growers he would protect the program, while also signaling that he sympathizes with U.S. refiners who bear its costs.
Refinery State Lawmakers Stump for Biofuel Meeting
Nine U.S. senators from states that have oil refineries sent a letter to President Donald Trump on Thursday urging changes to the country's biofuels policy and asking for a meeting to discuss the issue. The letter reflects growing tensions between refiners that oppose the U.S. Renewable Fuel Standard - a law requiring them to blend increasing amounts of ethanol into the nation's fuel each year - and the Midwest corn lobby that supports it. The Trump administration bowed to rising pressure from Midwest lawmakers last week, assuring them in letters and phone calls that it would ditch proposals, supported by the refining industry, to overhaul the biofuels policy.
Trump Plans to Meet Oil Industry Reps on US Biofuel Policy
U.S. President Donald Trump has agreed to meet with representatives of the oil refining industry and their legislative backers to discuss the nation's biofuels program, according to two sources briefed on the matter. The White House meeting could set the stage for negotiations over possible legislation to overhaul the U.S. Renewable Fuel Standard - a 2005 law that requires refiners to blend increasing amounts of biofuels like ethanol into the nation's gasoline each year, the sources said, asking not to be named. While the regulation would be a boon to the Midwest corn belt…
Trump Wades Deeper into Biofuel Debate
U.S. President Donald Trump on Thursday will gather rivals from the oil and corn industries for the second time this week as the administration seeks elusive common ground on reforms to the nation's controversial biofuels law. The meetings come amid rising concern in the White House over the current state of the U.S. Renewable Fuel Standard (RFS), a law requiring refiners to mix biofuels such as corn-based ethanol into their fuel, which has increasingly divided two of Trump's most important constituencies. A refining company, Philadelphia Energy Solutions (PES) in the key electoral state of Pennsylvania, last month blamed the regulation for its bankruptcy.
Shell Retains Deutsche Bank for CA Refinery Sale
Royal Dutch Shell plc has retained Deutsche Bank to sell its Martinez, California refinery, according to three people familiar with the matter. Shell is in the midst of a three-year, $30 billion divestment plan following the company's purchase of BG Group earlier this year. A Shell spokesman said the company would not comment on "rumor or speculation." Deutsche Bank declined to comment. The refinery, located 30 miles (48 km) northeast of San Francisco, has been operating since 1915. It can process about 165,000 barrels of crude oil daily into gasoline, jet fuel, diesel and other refined products. It has a coker unit used for processing heavy grades of crude.
Another Quarter of Weak Results Looms for U.S. Refiners
U.S. independent refiners such as PBF Energy and Phillips 66 are expected to report another quarter of disappointing profits in coming weeks, as hopes that a record summer driving season would turn the industry's fortunes around do not appear to have materialized. U.S. refiners are in the midst of their worst year since the shale boom began in 2011. High fuel inventories have punished margins this year, forcing some refiners to voluntarily cut production, delay capital work, lay off workers and slash employee benefits. With margins expected to remain under pressure, relief is not coming anytime soon, analysts say.
U.S. Refinery Workers Push Biofuels Reform
A delegation of workers from U.S. oil refining companies that oppose the nation's biofuels policy will converge on Washington on Wednesday to try to convince lawmakers to find a way to lessen the regulation's costs without hurting corn farmers. The trip, organized by the United Steelworkers union, marks the latest move in a battle between Big Oil and Big Corn over the fate of the U.S. Renewable Fuel Standard - a law requiring corn-based ethanol in gasoline that the refining industry says is costing it hundreds of millions of dollars a year. More than two dozen workers from refiners Valero Energy Corp…
Venezuela's Crude Sales to U.S. Falls to 15-year Low in February
Venezuela's crude exports to the United States declined in February to a 15-year low as oil production continues falling and President Donald Trump's administration weighs new sanctions on the OPEC country, according to Thomson Reuters data. Financial sanctions imposed by the United States in August on Venezuela and state-run oil firm PDVSA have created obstacles for selling crude cargoes to U.S. refiners, shrinking the number of customers PDVSA has in the U.S. In February, PDVSA and its joint ventures sent 21 cargoes to the United States - half the number it exported in recent years - with a total of 378…