Talk of incoming jet fuel cargoes helped the Los Angeles jet market to move 1.50 cents lower Wednesday to a one-month low.
Platts assessed Los Angeles jet fuel at the NYMEX June ULSD futures contract minus 1.75 cents/gal, or $1.3673/gal outright. The last time the differential was lower was on March 21, when it was minus 3.75 cents/gal.
Several jet cargoes were heard to be sailing from Asia after loading over the past two weeks. Silver Ginny and Torm Signe were heard to be carrying jet fuel from South Korea to Los Angeles, sources said. The Silver Ginny, which was heard to be carrying jet for Valero, is expected to arrive in Los Angeles May 4, according to cFlow, Platts trade flow software. The Torm Signe is expected to arrive May 10.
The High Mercury was heard to be carrying jet fuel from Dalian, China, sources said, and is set to arrive in Los Angeles May 12. China Aviation Oil shipped a cargo of jet fuel on the BW Lioness from Dalian that arrived in Los Angeles Monday.
The three cargoes left Asia between April 19 and April 24, according to cFlow data. During that time, the arbitrage was open, according to Platts calculations.
Considering $30.67/mt for freight, $414.102/mt for South Korea jet fuel and a value of $448.746/mt for Los Angeles jet fuel, the arbitrage was open to the tune of $3.97/mt Wednesday. The arbitrage window was seen open on 11 of the past 16 days.
In California, jet fuel stocks increased by 62,000 barrels last week to 3.419 million barrels, according to California Energy Commission data. The increase came as jet fuel output at Californian refineries jumped 381,000 b/d to 2.263 million b/d.
