Transportation constraints make it unlikely that Chicago-produced gasoline could fetch a better price on the Atlantic Coast, according to a poll of market players.
By mid-day Wednesday, Chicago conventional unleaded gasoline was heard at NYMEX March RBOB futures minus 30.00 cents/gal by minus 28.00 cents/gal.
Meanwhile, Atlantic Coast conventional for New York Harbor barges and Buckeye Pipeline was heard done at March plus 1.75 cents/gal, making the Chicago-to-Atlantic Coast price difference among the largest spreads seen over the past year.
Despite more favorable economics on the Atlantic Coast, physical barriers such as a dearth of pipelines or barge traffic connecting the former to the Chicago area prevent product movement or make it rare, traders said.
"This is usually accomplished by people in Pennsylvania and the like, who are served by Buckeye, to lift at racks in Ohio instead to get the Chicago prices," a source said Tuesday.
A second source said Wednesday, "Sometimes they can pump [barrels] from Chicago to Pittsburgh on the Buckeye Pipeline but it's rare."
Other sources doubted it was possible.
