Tampa:
Softening values at Brazil led to shifting perspectives on a potential landing spot for third-quarter Tampa molten sulfur contracts. While most speculation continued to center on a possible $0-$10/lt increase from the market’s second-quarter $192/lt CFR deal, some outlooks suggested a possible softening from the top of that range.
U.S. refinery utilization trickled lower for the week, according to the Energy Information Administration. Utilization was noted at 92.2 percent for the week ending June 18, a 0.4-point decline from the 92.6 percent reported one week earlier, but ahead of both the year-ago 74.6 percent and the 90.3 percent five-year average.
Daily crude inputs slipped to an average 16.112 million barrels/d for the week, falling 225,000 barrels/d from 16.337 million barrels/d in the prior report.
U.S. Gulf:
Tropical Storm Claudette had little discernible impact to refinery operations in the U.S. Gulf after coming ashore in Louisiana on June 19, sources reported.
ExxonMobil Corp. has rejected a series of United Steelworkers union (USW) contract proposals, extending a seven-week lockout at the company’s refinery in Beaumont, Texas, Seeking Alpha reported. Operations have continued at the 369,000 barrel/d facility since May 1 through the use of replacement workers.
Softening international values were reportedly pressuring potential Gulf netbacks, with some suggesting a tilt toward the low side of $190-$200/mt FOB.
Brazil:
Last-done spot transactions were noted in the $220s/mt CFR for the week, with sources pinpointing one deal at $221/mt CFR, down from the previous $225-$236/mt CFR range. Second-quarter Brazil contracts were quoted at $213-$214/mt CFR.
Caribbean:
The beleaguered Limetree Bay Energy refinery on the U.S. Virgin Island of St. Croix will remain shut indefinitely after a number of environmental incidents prompted the 210,000 barrel/d facility to temporarily cease operations in May.
The plant, which reopened in February following a 10-year idle period, was ordered shut by EPA for a minimum 60 days after spraying a number of local neighborhoods with petroleum droplets and contaminating a local water supply, news outlets reported.
Limetree was unable to secure funding to pay for an EPA mandate to install a large number of monitoring units as a prerequisite for reopening. As a result, the company will lay off approximately 271 employees effective Sept. 19, according to Reuters. Majority stakeholder Arclight Capital reportedly shed its position in Limetree earlier in June.
Vancouver:
Sources described nothing new from Vancouver, calling most-recent spot levels unchanged at $178-$180/mt FOB.
Alberta:
Alberta netbacks continued to be heard at $65-$110/mt FOB, inclusive of both molten tons contracted into the U.S. market and prills trading offshore through the Vancouver export market.
West Coast:
Ideas on West Coast prills continued to be reported in the $178-$180/mt FOB range, unmoved from one week earlier. Molten sulfur contracts were reported at $140-$155/lt FOB for the second quarter, a rise from $70-$77/lt FOB in the first quarter.
China:
The Chinese government may be cracking down on the country’s exploding independent oil refining industry, Bloomberg reported. The government is investigating potential environmental and tax violations at the country’s so-called teapot refiners, a sector of privately-owned facilities that has succeeded in gaining significant market share since receiving a regulatory green light in 2015.
The move could signal an end to the teapots’ fast expansion, potentially shifting greater control of the industry back to state-operated companies like Sinopec, CNOOC, PetroChina, and CNPC. Sources did not expect many significant output changes to result from the shakeup, however.
Port sulfur industries at China were recently reported falling to their lowest levels since 2019. Last-done spot import vessels were quoted in the $217-$220/mt CFR range, unmoved from the prior report.
ADNOC:
Solid sulfur cargoes were offered by the Abu Dhabi National Oil Co. at $185/mt FOB Ruwais for June, sources said, a $2/mt increase from the previous month’s $183/mt FOB.
Qatar:
Qatar prills continued to be quoted at $183/mt FOB Ras Laffan for June loading, unmoved from the previous period