Tampa: Negotiations for the first-quarter contract price of molten sulfur delivered to Tampa continued last week amid a backdrop of rapidly firming international spot levels.
With worldwide prices pointed up, most market watchers expressed confidence in an increase from the fourth-quarter price of $129/lt CFR. Until now, few in the market were eager to offer potential numbers for Q1, but a rise of $15-$20/lt was widely touted as a likely first-quarter landing spot for the updated contracts.
Many also speculated that negotiations could see a later-than-usual settlement date for the quarter, as consumers were seen as likely to seek added time for spot prices in the Chinese sulfur market to cool. The Chinese market has been universally recognized as the primary driver of the international price run-up.
Philadelphia Energy Solutions, the East Coast’s largest refinery, was operating at reduced capacity following a Jan. 10 fire at its Girard Point crude distillation unit, sources said. The incident, along with an explosion and fire at the Husky Lima Refinery in Lima, Ohio, an unplanned outage at the massive BP Whiting refinery, and a third refinery fire, was said to affect roughly 20 percent of the refining capacity in the eastern U.S. for the week.
The timing of the incidents raised speculation that refiners’ efforts to maintain record production quotas were to blame for the occurrences. However, most analysts pointed instead to cold weather as the likely culprit. All four afflicted refineries were expected to resume normal production on or around Jan. 17.
U.S. refinery operations fell again last week, according to data from the U.S. Energy Information Administration (EIA). The domestic utilization rate dropped to 91.0 percent of capacity for the week ending Jan. 9, down from 93.9 percent in the previous week. Despite the fall, the rate remained higher than last year’s 90.0 percent logged for the same week, as well as the five-year average of 87.1 percent.
Average daily refinery inputs dipped as well, registering 15.893 million barrels/d for the week, a decrease of 527,000 barrels/d from the previous week’s 16.420 million barrels/d average.
U.S. Gulf: Spot prices in the Gulf of Mexico increased to a range of $160-$170/mt FOB, according to industry sources. Previous levels were quoted in a range of $135-$140/mt FOB.
Vancouver: The Vancouver spot price continued to soar last week, with seemingly insatiable Chinese demand giving legs to offshore markets worldwide. Delivered prices at China, which bottomed at $185/mt CFR and were approaching or possibly exceeding the $200/mt CFR level last week, supported Vancouver levels averaging $170/mt FOB or above, traders said.
Alberta refiner Syncrude 21 was up and loading again last week, drawing cautious optimism from a number of industry insiders. The facility boasts an approximately 2,000 t/d production capacity.
Sulfur sourced from Alberta fell in a range of (-)$10-$75/mt.
West Coast: Following the rise at Vancouver, sources quoted prices from the West Coast as $160-$170/mt FOB.
Contracts for the price of molten sulfur at California rolled over for first-quarter 2015, and were quoted at $90-$130/lt FOB.
Benelux: Sulfur at Benelux was quoted in a range of $158-$172/mt FOB in the fourth quarter.
ADNOC: The January price of Abu Dhabi sulfur was $158/mt FOB.
Aramco: Aramco set its February price at $180/mt FOB, a jump of $22/mt from January’s $158/mt FOB. The price increase came amid heavy demand, sources said, with Aramco’s sulfur stocks said to be sold out through February.
Tasweeq: Qatar sulfur