Buckeye CBOB Basis Dips 19cts, Widens Chicago Spread


   
Miguel E. Andujar
DTN Refined Fuels Market Reporter

   DAVENPORT, FL (DTN) -- The basis of Buckeye CBOB  weakened sharply on 
Wednesday (3/18) on active trading, and significantly  widened its spread 
against  Chicago CBOB and Group 3 suboctane gasoline.

   Buckeye CBOB was assessed at a 60cts discount to the NYMEX April RBOB 
futures contract, down 19cts from the previous trading session, after a trade 
was heard at that level. Chicago CBOB was assessed at a 37cts discount to the 
same benchmark, down 3cts on the day, while Group 3 V-grade suboctane gasoline 
was assessed at a 66.50cts discount, 2cts lower than the previous session.

   The move widened to 23cts the Buckeye-Chicago CBOB spread and to 6cts the 
Buckeye-Group 3 spread. Both were wider than the 4cts average spread recorded 
from January to date. 

   The April NYMEX RBOB futures contract settled at $3.1271 gallon on 
Wednesday, up 2.86cts, or 0.92%, from $3.0985 in the prior session.

   "It's becoming difficult to price this market with the volatility in energy 
futures," a source familiar with the Midwest gasoline market said. "The Buckeye 
complex does not have much storage flexibility, and some of the pressure 
appears tied to broader market uncertainty and the need to liquidate barrels."

   The sharper decline in Buckeye compared with Chicago and Group 3 points to 
location-specific weakness as market participants continue to navigate volatile 
futures and shifting seasonal dynamics.




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