Tampa:
With sulfur values reported softening in a number of key international markets over the holidays, Tampa buyers noted little motivation to sign updated purchase contracts until pricing stabilizes.
Pre-holiday speculation centering on a $50-$70/lt increase from the market’s $90/lt CFR 4Q contract shifted lower in response to the emerging offshore price landscape, leading sources to voice speculation in a wide $30-$55/lt range.
“(The) best way to characterize the market is quiet with nothing pushing it up, so lackluster sentiment has it drifting downwards,” said one source.
US refinery utilization moved sharply lower in the Energy Information Administration’s (EIA) most recent report, presumably driven by production outages resulting from Winter Storm Elliott.
Refiners operated at a combined 79.6% capacity for the week ending Dec. 30, down 12.4 percentage points from 92.0% posted one week earlier. The current-week utilization rate lagged both the year-ago 89.8% and 88.1% five-year average.
Daily crude inputs also fell, moving below the 14 million barrel/d mark for the first time since the week ending March 12, 2021. Inputs were reported at an average 13.820 million barrels/d through the period, down 2.329 million barrels/d from 16.149 million barrels/d recorded for the week ending Dec. 23.
US Gulf:
Winter Storm Elliott’s late-December pass through the US triggered widespread production outages at US Gulf refineries, Reuters reported, removing about 1.5 million barrels/d of production capacity from the region during the last week of 2022. Houston-area shutdowns were reported from Total, Motiva, and Marathon, while upsets were noted at ExxonMobil, LyondellBasell, and Valero plants across Texas.
Motiva successfully restarted a 345,000 barrel/d crude distillation unit (CDU), 160,000 barrel/d vacuum distillation unit (VDU), and 45,000 barrel/d catalytic reformer on Dec. 30 at the company’s Port Arthur, Texas facility, Genscape reported. An 88,000 barrel/d fluidic catalytic cracking unit (FCC) and 12,000 barrel/d hydrotreater, noted ramping up on Dec. 29, returned to production on Jan. 3, followed by a 210,000 barrel/d CDU and 100,000 barrel/d VDU on Jan. 4. The units were reported shutting down on Dec. 23 due to extreme cold. With a stated 636,500 barrel/d capacity, Motiva Port Arthur is the nation’s largest refinery.
Valero on Dec. 31 restarted an 80,000 barrel/d FCC at its Port Arthur refinery, shut during the same cold-weather event. A 57,000 barrel/d hydrocracker and 53,000 barrel/d catalytic reformer began ramping up activity on Dec. 26, but had not fully restarted on Jan. 3.
Pemex Deer Park, Texas, restarted multiple units on Jan. 3, including a 270,000 barrel/d CDU; 70,000 barrel/d CDU; 115,000 barrel/d VDU; 70,000 barrel/d FCC; 45,000 barrel/d catalytic reformer; 67,000 barrel/d hydrocracker; and a 72,000 barrel/d hydrotreater. The units were taken offline on Dec. 24.
Falling prices at Brazil were expected to drag the US Gulf sulfur market lower in the next round of business, with some predicting a slide into the $130s-$140s/mt FOB. With nothing heard to conclude at the lower levels during the week, the market continued at the last-reported $155-$165/mt FOB.
Brazil:
Recent sulfur business at Brazil was reported in a $173-$176/mt CFR range, falling from $194/mt CFR noted previously. Some players expected continued softening in the next round of business, predicting an imminent decline into the upper-$150s/mt or low-$160s/mt CFR.
Fourth-quarter contracts were quoted at $119-$138/mt CFR.
Vancouver:
Vancouver softened to a $150-$155/mt FOB range, players said, below $160-$170/mt FOB in the prior report.
Alberta:
Alberta sulfur netbacks softened to a wide (-)$25-$85/mt FOB during the week, off from (-)$25-$100/mt FOB the prior report. Molten tons contracted into the US set the range’s low, while prilled material selling through the Vancouver export market established the high.
West Coast:
West Coast solid sulfur cargoes were indicated even with Vancouver at $150-$155/mt FOB.
Sources reported fourth-quarter molten sulfur contracts at $75-$79/lt FOB, below $370-$385/lt FOB in the third quarter.
China:
Last-done spot business into China was reported in the $170-$175/mt CFR range, softening from $188-$190/mt CFR noted previously. Pricing rumored in the $150s/mt CFR during the week went unconfirmed on Jan. 5.
ADNOC:
Abu Dhabi National Oil Co. offers for January were noted at $160/mt FOB Ruwais, off $20/mt from $180/mt FOB in December.
Qatar:
January prill offers for tons loading from Qatar were heard at $155/mt FOB Ras Laffan, down $30/mt from December’s $185/mt FOB posting.
Kuwait:
Kuwait sulfur cargoes softened to $154/mt FOB for January, down $29/mt from $183/mt FOB reported for December.