With the BP Whiting, Ind. refinery down for the count, it seems other refineries may put off maintenance to try to fill that void. A Bloomberg news story reports that, "At least one Midwestern refinery is said to be considering a delay in maintenance work after a slowdown at BP Plc's plant near Chicago sent regional profit margins to a seven-year high."
Phillips 66 is weighing the postponement of a planned September turnaround at its Wood River, Ill., refinery by several weeks, people familiar with the deliberations said. They had better, because demand in the United States is much stronger than anticipated. The Energy Information Administration estimated Tuesday that as much as 140,000 barrels a day of gasoline output is being lost after leaks at the biggest crude unit in BP's Whiting refinery reduced operations there. Given how strong margins are, it wouldn't be surprising.
Bloomberg also reports: "Tempting refiners to rethink the tradition of doing repairs after the peak gasoline season wanes in September are profit margins that reached $50.48 in the Chicago area on Aug. 12, the highest since September 2008. On the same day, the spread between gasoline and oil traded in New York was $30.73. A decline to a $38.19 margin in Chicago on Tuesday still leaves the regional spread at its highest in more than two years."
The American Petroleum Institute (API) showed that U.S. demand continues to be resilient. The American Petroleum Institute reports inventories of crude oil U.S. fell by 2.3 million barrels and gasoline supplies fell by 1.5 million barrels. This comes as OPEC continues to pump at a high level.
More oil pain. The Financial Times reports that "Norway's $870 billion oil fund suffered its first negative return in three years as weak equity and bond markets weighed on the world's largest sovereign wealth fund. The fund had a negative return of 0.9% in the second quarter, dragged down by a loss of 2.2% on bonds and of 0.2% on equities. But it still managed to beat its benchmark by 0.4 percentage points."