By Barbara Powell – Sep 10, 2012 4:34 PM GMT+0100
Gasoline gained after a report that flooding and mechanical issues have slowed the startup of Motiva Enterprises LLC’s Convent, Louisiana, refinery as it tries to return to production after Hurricane Isaac.
Futures rose as Motiva expects to need another week to get the main production units running at the 255,000-barrel-a-day plant, according to two people familiar with operations. Three refineries in the Gulf Coast are starting and six are at reduced rates after the storm, which knocked out 13 percent of the area’s refining capacity when it struck Aug. 29.
“The ongoing problems with refinery restarts are a surprise to analysts and suggest the product market may be in disarray for weeks,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago.
October-delivery reformulated gasoline, or RBOB, advanced 1.95 cents, or 0.7 percent, to $3.0391 a gallon at 11:21 a.m. on the New York Mercantile exchange.
Motiva expects to return its Norco plant to normal operating rates by Sept. 15, said the people, who declined to be identified because they are not authorized to speak for the refinery. The Norco refinery was shut Aug. 30. The Convent refinery was shut Aug. 28.
Gulf Coast refinery utilization dropped to 82.2 percent in the week ended Aug. 27 from 91.4 percent a week earlier, according to Energy Department data. Stockpiles in the U.S. sank 1.2 percent last week to 198.9 million barrels, the lowest level since the week ended Nov. 14.
Regular gasoline at the pump, averaged nationwide, increased 0.3 cent to $3.828 a gallon yesterday, AAA data showed. Prices are up 50.2 cents from the year-to-date low of $3.326 on July 1.
Heating oil for October delivery rose 1.53 cents, or 0.5 percent, to $3.1642 a gallon.
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