Rising stocks pressure Tulsa gasoline prices

Southern US midcontinent gasoline prices fetched the widest discount to the Nymex RBOB contract in 12 sessions today, with market participants saying CBOB inventories at the Magellan pipeline in Tulsa, Oklahoma, have swelled to nearly 11mn bl.

Deals for 13.5 RVP CBOB at Tulsa were done at an 8-9.25¢/USG discount to the Nymex price, increasing that spread by 1.38¢/USG from yesterday to the widest since late December and more than 3¢/USG larger than year-earlier levels. This comes as market participants said high gasoline inventories in Tulsa have weighed on buying demand throughout the southern Midwest. Rising Nymex RBOB futures — which have increased by 18.16¢/USG to $2.457/USG since 11 January — have also prompted deal levels to press lower, as outright prices to purchase Tulsa CBOB rose by 1.145¢/USG to $2.37/USG today, the highest since late October amid the Nymex gains.

Arbitrage economics for shipping US Gulf coast CBOB to Tulsa remained unviable today, with Tulsa's discount to Colonial pipeline prices increasing by 1.13¢/USG to 3.63¢/USG. Tulsa prices have fetched a discount to the US Gulf coast in all but two sessions since 29 September.

By Jared Ainsworth