US Products

DAILY

06E-041 - 02 MARCH 2006. HOUSTON 1700 CENTRAL TIME

OVERVIEW

GASOLINE
New York Waterborne
87 M
87 A
83.7 RBOB
89 Conv
89 RFG
91.3 RBOB
93 R
93 D
Boston Waterborne
87 A
New York Barge
87 M Prompt
87 M Any Mar
87 A Prompt
87 A Any Mar
83.7 RBOB Prompt
83.7 RBOB Any Mar
89 Conv Prompt
89 RFG Prompt
93 R Prompt
93 D Prompt
91.3 RBOB Prompt
Buckeye
87 M
83.7 RBOB
89 Conv
93 R
91.3 RBOB
Laurel
87 Conv
89 Conv
93 Conv

Differential

Price

Delta

Apr
Apr
Apr

-4.63/-2.63
-4.75/-2.75
-4.50/-2.50

Apr
Apr
Apr

+9.05/+11.05
+9.05/+11.05
+8.75/+10.75

164.63/166.63
164.50/166.50
164.75/166.75
169.41/171.41
169.23/171.23
178.30/180.30
178.30/180.30
178.00/180.00

+6.26
+7.01
+5.96
+6.43
+6.75
+6.76
+6.76
+6.26

GASOLINE
Apr

-4.25/-2.25

Apr
Apr
Apr
Apr
Apr
Apr

-4.00/-3.50
-4.25/-4.00
-5.00/-3.00
-5.00/-3.00
-4.00/-3.50
-4.25/-3.75

Apr
Apr
Apr

+9.50/+10.50
+9.00/+10.00
+9.50/+10.50

Apr
Apr

-4.00/-3.25
-4.00/-3.50

Apr
Apr

+9.50/+10.50
+9.50/+10.50

Apr

-3.50/-2.75

Apr

+10.00/+11.00

165.00/167.00

+7.01

165.25/165.75
165.00/165.25
164.25/166.25
164.25/166.25
165.25/165.75
165.00/165.50
169.98/170.65
169.15/170.80
178.75/179.75
178.25/179.25
178.75/179.75

+6.13
+6.38
+7.01
+7.01
+5.76
+5.91
+6.36
+6.75
+6.76
+6.26
+6.76

165.25/166.00
165.25/165.75
169.98/170.81
178.75/179.75
178.75/179.75

+6.01
+5.76
+6.27
+6.76
+6.76

165.75/166.50
170.48/171.31
179.25/180.25

+6.01
+6.27
+6.76

/USG

DIESEL VS HEATING OIL, FOB NYH

18.00
16.00
14.00
12.00
10.00
8.00
6.00
4.00
2.00
0.00
-2.00
1-Dec

Page 1 of 7

New York gasoline differentials weakened while diesel values

firmed considerably.Low sulphur VGO offers were widely circulated at discounts to clean products 70:30, but high sulphur
VGO discussions remained pegged to Nymex crude oil futures.
High sulphur fuel oil prices in the Atlantic coast gained as more
buying demand emerged. Gulf coast conventional gasoline was
heavily traded on regrades as the RVP phase down is now in
effect. Jet 54 differentials strengthened in moderate trading.

15-Dec 29-Dec

12-Jan

26-Jan

9-Feb

23-Feb

ATLANTIC COAST: Gasoline differentials in New York weakened on Thursday even as the April RFG Nymex futures gained
7/USG. Conventional gasoline values traded almost flat until the
end of the month for most of the day. 87 conventional M4 traded a
number of times at April Nymex -4.00 for prompt as well as ratable
March barrels. Towards the afternoon, a blender sold 25,000 bl of
M4 available 10 March to a refiner at April Nymex -3.75 fob New
York Harbor. Later, the same refiner bought 15,000 bl of M4 available 4-7 March on the Buckeye pipeline's cycle 052e from a major
at April Nymex -3.25 fob New York Harbor. Rbob values moved in
tandem with conventional gasoline values. 83.7 Rbob F4 available
mid-March as well as by 9 March traded at April Nymex -3.75 fob
New York Harbor. A blender was also heard selling a 65,000 bl of
F4 to a trader at April Nymex -3.50 fob New York Harbor. There
was little discussion heard for 87 RFG A4. A4 bids on
HoustonStreet were seen first at April Nymex -5.50 and then at
April Nymex -4.50, but no trades were completed. High-octane
gasoline grades continued to see few offers and no bids.
GULF COAST: RVP changes gave rise to large volumes of conventional gasoline traded on regrades in the Gulf coast. On
Thursday, 11.5 RVP became the standard on the Colonial Pipeline
for the prompt cycle. The upcoming cycle will coincide with a
more stringent RVP standard of 9 RVP. On the 15th cycle the outdated 87 conventional M4 with 13.5 RVP was still trading, with
deals done at April Nymex +2.25 and April Nymex +2.60. 87 conventional M3 with RVP of 11.5 traded on the 15th cycle between
April Nymex +3.80 and April Nymex +4.50, with a deal done as
well at April Nymex +4.00. A 15th cycle M3 trade was reportedly
done as low as April Nymex +3.50, but was not confirmed. On the
16th cycle, 87 conventional M2 with RVP of 9 traded at April
Nymex +6.00. 16th cycle M2 traded for 200,000 bl at M3 +2.00.
Another 125,000 bl of M2 traded on the 17th cycle, again at M3
+2.00. 87 RFG A4 was still talked around M3 +4.50. 93 RFG D3
was talked between A3 +14.00 and A3 +15.00. High octane 93
conventional V2 continued its ascent, trading on the 16th cycle at
M2 +14.00. Low sulphur 87 conventional W3 weakened to trade
twice on the 15th cycle at M3 +1.75.

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US Products
US Gulf Coast Waterborne
87 M
Apr
87 A
Apr
89 Conv
93 V
Apr
Colonial
87 M Cycle 15
87 M Cycle 16
87 A Cycle 15
87 A Cycle 16
87 W Cycle 15
87 W Cycle 16
89 Conv
93 V Cycle 15
93 V Cycle 16
93 D Cycle 15
93 D Cycle 16

02 March 2006

+4.30/+5.00
+8.90/+9.40
+19.15/+20.15

Apr
Apr
87 M
87 M
87 M
87 M

+3.80/+4.50
+6.00/+6.75
+4.25/+4.75
+4.25/+4.75
+1.50/+2.00
+1.50/+2.00

87 M
87 M
87 M
87 M

+14.50/+15.50
+14.50/+15.50
+18.25/+19.75
+18.25/+19.75

Houston / New York Arbitrage

87 M
93 V
Group 3
87 N Prompt
87 N Any Mar
91 A Prompt
Chicago
87 Conv 1st Mar
87 Conv 2nd Mar
89 Conv Prompt
93 Conv 1st Mar
93 Conv 2nd Mar
85 RBOB 1st Mar
85 RBOB 2nd Mar

+9.23
+9.23
+10.29
+12.23

173.05/173.75
175.25/176.00
177.65/178.15
179.88/180.38
174.90/175.40
177.13/177.63
178.25/179.05
187.90/188.90
190.13/191.13
191.65/193.15
193.88/195.38

+7.16
+6.88
+7.16
+6.81
+10.29
+10.16

-11.21
-12.54

+10.00/+11.00
+10.00/+11.00
+6.75/+7.00

179.25/180.25
179.25/180.25
186.50/186.75

+7.51
#N/A
+6.88

Apr
Apr

+9.25/+9.75
+9.50/+10.00

178.50/179.00
178.75/179.25
179.29/179.79
180.75/181.25
181.00/181.50
181.25/181.75
181.50/182.00

+5.88
+6.13
+6.06
+6.38
+6.63
+6.13
+6.38

87
87
87
87

San Francisco
85 CARBOB (Mar)
89.5 CARBOB (Mar) 85

+2.00/+2.50
+2.00/+2.50
+2.50/+3.00
+2.50/+3.00

CLEAN PRODUCTS DEALS DONE

Colonial M4
15th Cycle
15th Cycle

+2.25
+2.60

Colonial M3
15th Cycle

M4+2.00 50

15th Cycle
15th Cycle
15th Cycle
15th Cycle

+3.80
+4.00
+4.50
+4.50

+6.50/+8.50

188.25/189.25
193.05/194.05
195.25/197.25

+9.01
+8.61
+9.01

+6.50/+8.50

184.25/185.25
191.25/193.25

+10.01
+10.01

181.75/182.75

+6.51

000
50
25

25
25
25
25

Colonial M2
16th Cycle

+6.00

16th Cycle

M3+2.00 200

17th Cycle

M3+2.00 125

Colonial V2
16th Cycle

Apr
Apr
87 N

Los Angeles
85 CARBOB (Mar)
85 CARBOB (Apr)
89.5 CARBOB (Mar) 85

Portland
87 Conv (Mar)

173.55/174.25
178.15/178.65
178.75/179.55
188.40/189.40

50

M3+1.75 25
M3+1.75 150

Colonial 86
14th Cycle

+0.75

15th Cycle
.
.

+9.50
+9.50
+9.85
+10.00
+10.25
+11.00

000
50
50
25
25
25
25

Colonial Jet 54 TX Or.

15th Cycle
+10.00

50

Group Three 87N

Ppt
+10.00
Ppt
+11.00
Chicago 87CNV
Mar Cyc1

+9.50

Chicago HILO
Mar CYc2

+7.40

Group Three X
Ppt

+11.00

10

M2+14.00 25

Colonial W3
15th Cycle
15th Cycle

Colonial 74
14th Cycle
14th Cycle

Colonial Jet 54
15th Cycle
15th Cycle
15th Cycle
15th Cycle
15th Cycle
15th Cycle

+9.75
+10.50

25
25

+9.50

50

Group Three X5
Ppt
X-8.00
Chicago LSD
Mar Cyc1
Mar Cyc1

+7.75
+8.00

Mar Cyc2
Mar Cyc2

+9.25
+9.50

Mar Cyc3
Mar Cyc3

+9.50
+10.00

MIDCONTINENT: Midcontinent gasoline differentials were little

changed in both Group Three and Chicago. Cash prices experienced large increases as Nymex gasoline futures jumped by more
than 7c/USG for the front month. In Group Three, prompt 87 conventional N traded at April Nymex +10.00 and April Nymex
+11.00. Prompt high-octane 91 conventional A was offered on
HoustonStreet at 87N +7.00, a 50 point loss from last week. In
Chicago, 1st March cycle 87 conventional traded at April Nymex
+9.50. 1st March cycle 93 conventional was talked at 87 cnv
+2.25. 1st March cycle Rbob differentials were discussed stronger,
around 87 cnv +2.75.

DISTILLATES
ATLANTIC COAST: Diesel in New York strengthened substantially as differentials were pushed upwards by an illiquid market and
stronger Gulf coast values. Only one diesel trade was heard done on
Thursday, for a 35,000 bl barge loading 5 March at April Nymex

Page 2 of 7

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US Products

02 March 2006

DISTILLATES
Differential

Price

Delta

New York Waterborne

No2 Oil
Apr
LS Diesel
Apr
Jet 55
Apr

-0.15/+0.20
+15.05/+15.40
+14.80/+15.15

180.34/180.69
195.54/195.89
195.29/195.64

+5.70
+7.80
+7.67

Boston Waterborne
No2 Oil

Apr

+0.35/+0.70

180.84/181.19

+5.70

New York Barges

No2 Oil Prompt
No2 Oil Any Mar
LS Diesel Prompt
LS Diesel Any Mar
Jet 54 Prompt
Jet 55 Prompt

Apr
Apr
Apr
Apr
Apr
Apr

-0.65/-0.30
-0.65/-0.25
+14.50/+15.00
+14.50/+15.00
+11.50/+12.00
+14.00/+15.00

179.84/180.19
179.84/180.24
194.99/195.49
194.99/195.49
191.99/192.49
194.49/195.49

+5.70
+4.73
+7.83
+6.83
+6.08
+7.58

Buckeye
No2 Oil
LS Diesel
Jet 54
Jet 55

Apr
Apr
Apr
Apr

-0.65/-0.30
+14.50/+15.00
+11.50/+12.00
+14.00/+15.00

179.84/180.19
194.99/195.49
191.99/192.49
194.49/195.49

+5.76
+7.83
+5.71
+7.58

Laurel
No2 Oil
Jet 54

Apr
Apr

-0.55/-0.20
+11.50/+12.00

179.94/180.29
191.99/192.49

+5.61
+5.46

US Gulf Coast Waterborne

No2 Oil
Apr
LS Diesel
Apr
Jet 54
Apr
Jet 55
Apr

+1.00/+1.50
+10.00/+11.00
+10.00/+11.50
+10.50/+12.00

181.49/181.99
190.49/191.49
190.49/191.99
190.99/192.49

+5.83
+6.83
+7.16
+7.16

Colonial
No2 Oil Cycle 14
No2 Oil Cycle 15
LS Diesel Cycle 14
LS Diesel Cycle 15
Jet 54 Cycle 15
Jet 54 Cycle 16
Jet 55 Cycle 15
Jet 55 Cycle 16

+0.50/+1.00
+0.50/+1.00
+9.50/+10.50
+9.75/+10.75
+9.50/+11.00
+9.75/+11.25
+10.00/+11.50
+10.25/+11.75

180.99/181.49
180.99/181.49
189.99/190.99
190.24/191.24
189.99/191.49
190.24/191.74
190.49/191.99
190.74/192.24

+5.83
+5.83
+6.83
+6.86
+7.18
+7.33
+7.53

Apr
Apr
Apr
Apr
Apr
Apr
Apr
Apr

Houston / NY Arbitrage
No2 Oil
LS Diesel
Jet 54

-3.99
+1.66
-1.79

Group 3
LS Diesel X Prompt
LS Diesel X Any Mar
Diesel X5 Prompt
Jet Q Prompt

Apr
Apr
LSD X
Apr

+10.75/+11.25
+11.00/+11.50
-8.25/-7.75
+13.25/+13.75

191.24/191.74
191.49/191.99
183.24/183.74
193.74/194.24

+5.83
+5.83

Chicago
No2 Oil Prompt
LS Diesel 1st Mar
LS Diesel 2nd Mar
Jet 1st Mar
Jet 2nd Mar

LSD
Apr
Apr
Apr
Apr

-3.50/-3.25
+7.75/+8.00
+9.25/+9.50
+9.25/+9.75
+9.25/+9.75

184.87/185.12
188.24/188.49
189.74/189.99
189.74/190.24
189.74/190.24

+7.71
+7.71
+9.21
+6.83
+6.83

+14.90 fob New York Harbor. On HoustonStreet prompt diesel bids

were seen at April Nymex +13.00 and offers as high as April
Nymex +15.00 fob New York Harbor. Heating oil differentials were
marginally weaker. A refiner sold a 30,000 bl barge of heating oil
available 3 March at April Nymex -0.55 fob New York Harbor. The
same refiner also sold 65,000 bl of heating oil available 5 March on
the Buckeye pipeline at April Nymex -0.50. Heating oil available
11-13 March on cycle 053e of the Buckeye pipeline traded a couple
of times at April Nymex -0.50 fob New York Harbor. Jet 54 differentials appeared slightly stronger on Thursday. 25,000 bl of jet 54
available 18-19 March on the 11th Colonial pipeline cycle traded at
April Nymex +11.90 delivered New York Harbor. Kerosine differentials seemed to move into a marginal discount to diesel values as
kerosine available on the Colonial pipeline's 11th cycle traded at
April Nymex +14.00. Traders said that forward values for all distillate grades were flat till the end of the month.
GULF COAST: Jet 54 differentials firmed in the Gulf coast in
moderate trading, while diesel and heating oil were highly illiquid. Heating oil was bid mid-morning on the 14th cycle at April
Nymex -1.00 and offered at April Nymex +1.00. Little changed
for 14th cycle heating oil until mid afternoon, when a trade was
done at April Nymex +0.75, leaving differentials unchanged from
Wednesday. Diesel differentials firmed, with 14th cycle trades
done at April Nymex +9.50 and April Nymex +10.50. A 14th
cycle diesel deal was heard as high as April Nymex +11.00 in the
afternoon, but was not confirmed. On the 15th cycle, diesel traded at April Nymex +9.75. Jet 54 traded on the 15th cycle
between April Nymex +9.50 and April Nymex +11.00, with trades
done as well at April Nymex +9.85, April Nymex +10.00 and
April Nymex +10.25.
MIDCONTINENT: Low sulphur diesel differentials were essentially unchanged in the midcontinent as the EIA data for last week
reported little change in stocks or production in the region. Total
US distillate stocks dropped, but the draw came primarily from
Atlantic coast inventories. Imports were also stagnant. In Group
Three, prompt low sulphur diesel X was heard around April Nymex
+10.75. Any April X was bid at Any March X -1.75 on
HoustonStreet, maintaining a healthy contango for the distillate. In
Chicago, 1st March cycle low sulphur diesel was talked around
April Nymex +6.00, much unchanged from Tuesday's trade. 1st
March cycle jet fuel was heard at April Nymex +8.50.

FEEDSTOCKS/BLENDSTOCKS
+5.83

VACUUM GASOIL/STRAIGHT RUN: VGO buying interest

was significantly weaker on Thursday due to hiked values for both
high and low sulphur VGO. Low sulphur VGO was more actively
offered than sour grades, with most sellers setting offers at discounts to the clean products 70:30. A major was offering 0.45pc
sulphur VGO at 70:30 -11.50. Other offers ranged between clean
products -13.00 and -11.00. A major sold 65,000 bl of 0.45pc sulphur, 176 aniline VGO at 70:30 -12.50 FOB Texas City late
Wednesday. Late Thursday, the same parties traded another 50,000
bl at the same price and specifications, for 3-5 March delivery. A

Page 3 of 7
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US Products

San Francisco
Carb Diesel (Mar)
EPA Diesel (Mar)
Jet (Mar)

Apr

Apr

+14.00/+15.00

203.49/204.49
202.49/203.49
194.49/195.49

+5.33
+4.33
+4.83

+13.00/+14.00

202.49/203.49
201.49/202.49
193.49/194.49

+5.33
+4.33
+4.83

211.49/213.49

+10.33

Portland
LS Diesel (Mar)

FEEDSTOCKS AND BLENDSTOCKS

Vacuum Gasoil Gulf Coast Waterborne
0.5% Cargo
70:30
-19.50/-18.50
0.5% Barge
70:30
-13.00/-12.00
1.0% Cargo
70:30
-25.75/-25.25
1.0% Barge
70:30
-21.50/-21.00
2.0% Cargo
70:30
-32.75/-32.25
2.0% Barge
70:30
-31.00/-30.00

WTI
WTI
WTI
WTI
WTI
WTI

70:30 Formula
Gulf Coast

175.43/176.07

+8.21

Naphtha Barge Gulf Coast

40 N+A
87
80 min Paraffin

-3.50/-3.00
552.00/552.50

+3.00

MTBE Barge
Houston
New York

Apr
Apr

+22.00/+24.00
+10.00/+15.00

191.25/193.25
179.25/184.25

+6.01
-3.49

Alkylate
New York
Houston

Apr
87 M

+46.00/+48.00
+42.00/+43.50

215.25/217.25
215.40/216.90

+7.01
+9.23

245.00/249.00
235.00/240.00
250.00/255.00

-2.00
-1.50
-5.00

Ethanol
New York
Chicago
Los Angeles

RESIDUAL FUEL OIL

New York Waterborne
0.3% Low Pour
0.3% High Pour
0.7%
+0.50
1.0%
+0.50
2.2%
+0.50
3.0%
+0.50

54.00/54.50
50.50/51.00
49.50/50.00
48.50/49.00
46.75/47.25
46.50/47.00

+0.75
+0.75
+0.50
+0.50

47.25/47.75
47.00/47.50

+1.00
+1.25

1pc New York Swaps

Mar
+0.20
Apr
+0.55
May
+0.55

47.95/48.05
48.65/48.75
49.45/49.55

+0.20
+0.55
+0.55

Page 4 of 7

NAPHTHA: Sporadic trading activity was noted in naphtha markets as a brief spike in buying interest tapered off. A trader reportedly sold 210,000 bl of Talara N+A naphtha from Peru to a major
at unleaded 87 conventional gasoline -3.25. The Talara barrels are
due to load 10-12 March. A refiner was heard offering N+A naphtha with light front end out of Garyville at a 0.25c/USG discount to
publication-related prices. The barrels were still available as of
early Thursday. Mongstat 43-44 N+A naphtha from Norway for 1520 March loading also remained on offer. Paraffinic naphtha barges
were heard readily available, at prices as low as unleaded gasoline 9.00 or April Nymex gasoline -20.00. A refiner reportedly offered
Aruban light straight run barrels, with no takers as yet. Sluggish
natural gasoline prices of late had further pushed back paraffinic
naphtha demand. Natural gasoline prices edged up 0.50c/USG to
finish at 135.50c/USG on Thursday.
OCTANES/OXYGENATES: Blendstock values relative to gasoline came under additional pressure, with both ethanol and MTBE
values slipping lower. Healthy finished gasoline stocks and a lull in
the sense of panic about the rapid phase-out of MTBE may have
contributed to the pressure on blendstock prices. Buying interest in
March MTBE emerged in the Gulf coast, with bids heard around
192.00, but no deals could be confirmed. In New York Harbor, spot
MTBE for March was talked between April Nymex +10.00 and
April Nymex +15.00, a large decline in the premium over gasoline.
Ethanol in New York Harbor was heard offered at 245.00, where a
deal was done on Wednesday. On the west coast, ethanol was
talked around 255.00, while Chicago spot ethanol was talked as
TOTAL US GASOLINE IMPORTS
Total US Gasoline Imports
1,700
1,500

Gulf Coast Waterborne

1.0%
+1.00
3.0%
+1.00

3pc Gulf Coast Swaps

Mar
+1.10
Apr
+2.65

+2.27/+2.69
+5.00/+5.42
-0.36/-0.15
+1.43/+1.64
-3.30/-3.09
-2.56/-2.14

refiner was heard to be seeking low sulphur VGO because of a

hydrogen problem. Sour barrels continued to be perceived in short
supply. In contrast to low sulphur VGO offerings, which were
mostly discussed against clean products 70:30, sour grades discussions remained pegged to the Nymex crude oil futures. On
Wednesday, a major sold 135,000 bl of 2pc sulphur, 165 aniline,
1000 nitrogen barrels to a second major at a publication related
price. A refiner purchased 70,000 bl of 2.68pc sulphur VGO from a
second refiner at a discount to Argus high sulphur VGO barge differential against Nymex WTI. The barrels are expected to be delivered within the northeast region. A major has prompt high sulphur
VGO available in tanks but had adjusted its offer from April
Nymex -6.00 on Wednesday to May Nymex -5.00 on Thursday,
with no takers.

'000 b/d

Los Angeles
Carb Diesel (Mar)
EPA Diesel (Mar)
Jet (Mar)

02 March 2006

1,300
1,100
900
700
500
27Dec

47.10/47.20
48.60/48.70

+1.10
+2.65

24Feb

24Apr

Average Imports

22Jun

20Aug

18Oct

16Dec

13Feb

4 week average

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US Products

02 March 2006

BUNKER FUEL
New York
Houston
Los Angeles
Portland
Seattle

180 CST
328.00/332.00
315.00/320.00
348.00/352.00
373.00/377.00
363.00/368.00

+6.00

high as 245.00. Traders said ethanol in Houston was being offered

at significant premiums to New York Harbor. Alkylate values were
unchanged in light discussion.

380 CST
309.00/313.00
300.00/305.00
333.00/337.00
343.00/347.00
333.00/338.00

+6.00

x
NYMEX
87 RFG New York Gasoline
Apr
May
Jun

169.25
174.05
177.20

+7.01
+6.61
+6.16

87 RFG Crack
Apr
+7.72
May
+8.03
Jun
+8.37

RBOB New York Gasoline

Apr
May
Jun

186.25
188.75
191.25

+6.26
+5.76
+5.26

RBOB Crack
Apr
+14.87
May
+14.21
Jun
+14.28

180.49
182.24
183.49

+5.83
+5.78
+5.38

No2 Oil Crack

Apr
+12.45
May
+11.47
Jun
+11.02

Cushing Light Sweet Crude

Apr
May
Jun

63.36
65.07
66.05

+1.39
+1.45
+1.39

Henry Hub Natural Gas

Apr
May

6.760
6.960

+0.03
+0.02

New York No2 Oil

Apr
May
Jun

BTU VALUES AND SPARK SPREADS

New York Diesel
New York 0.3% HP Resid
New York 1% Resid
Transco Zone 6 Gas
1% Central App Coal

BTU Value
14.16
8.57
7.64
7.51
2.95

Spark Spread vs PJM

-83.12
-6.42
-27.23
-0.75
+0.10
-17.86
-1.73
+0.20
-16.57
-2.76
-0.01
+29.00 -0.65
+0.57

0.5% VS 2.0% VGO BARGES

27.00

/USG

22.00
17.00

7.00

Page 5 of 7

ATLANTIC COAST: Liquidity continued to be thin in the

Atlantic coast as traders struggled to move discussions to the afternoon. As a result, only a handful of buyers and sellers were seen in
a market that remains devoid of incremental demand. Export
momentum has declined but some traders are still eyeing arbitrage
opportunities in the wake of reduced domestic demand. Natural gas
is nearly $6.50/bl cheaper than the benchmark 1pc sulphur fuel oil,
giving utilities little incentive to switch to the latter. 1pc sulphur
fuel oil swaps jumped on the back of Nymex futures, as did physical prices for mid and high sulphur fuel oil grades. The market was
seemingly dominated by buyers but there was little firm price
direction. A trader was heard bidding for 100,000 bl of 0.3pc sulphur low pour fuel oil at 55.00 and the mean, delivered New York
Harbor on 8-12 March. A major was seeking a similar quality parcel based on published prices. A trader bid for 100,000 bl of 0.7pc
sulphur fuel oil at 50.25. A major bid for 1pc sulphur fuel oil at
49.50, fob New York Harbor. No offers were seen for the last two
grades. The same major offered 3pc sulphur fuel oil at 48.55.
Another major and a trader bid for 2.2pc or 3pc sulphur fuel oil at
47.50.
GULF COAST: Fuel oil prices in the Gulf coast surged on the
back of rising crude, even though fundamental demand remains
weak both for low and high sulphur fuel oil. Bunker activity has
been sporadic and has lacked consistency. Overall, demand is
steady but not enough to move prices considerably. Demand in
Central America has been relatively stable. High sulphur fuel oil
demand in the Caribbean has waned, as it normally does at this
time of the year. The arbitrage from Houston to Singapore is heard
to be difficult despite strong demand in Asia. Several large cargoes
from Venezuela are heard to be destined for Sinagpore. At least one
VLCC was confirmed and another was being discussed.
Meanwhile, M-100 imports have started to pick up gradually but
most of them are contractual volumes. The US Gulf coast market is
inherently depended on Asia for import activity. If prices declined
in Asia, more cargoes will likely be seen in Houston and New
Orleans. Fresh deals indicated that there was a minor spread
between 1pc and 3pc sulphur fuel oil. A major sold 130,000140,000 bl of 1pc sulphur fuel oil, loading 6-8 March, to a trader at
47.75 fob St. Rose. A major sold 45,000 bl of 3pc sulphur fuel oil,
loading 7-9 March, to another major at 47.25 fob Beaumont. A
trader bid for 3pc at 46.20 fob St. Rose. Another trader bid for 3pc
at 47.00 fob Gretna.

US WEST COAST

12.00

2.00
1-Dec

RESIDUAL FUEL OIL

15-Dec 29-Dec 12-Jan 26-Jan

9-Feb

23-Feb

CLEAN PRODUCTS: Gasoline differentials in the west coast

firmed while distillate spreads to Nymex heating oil futures were
little changed. Spot activity once again revolved around gasoline,
as more buying demand emerged in San Francisco. The California
Energy Commission reported that for the second consecutive week,

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COPYRIGHT 2006 BY ARGUS MEDIA LTD. ALL RIGHTS RESERVED. UNAUTHORIZED RETRANSMISSION OR REPRODUCTION PROHIBITED.

US Products

02 March 2006

PRICE ASSESSMENT METHODOLOGY

Argus US refined products prices represent the market over the course
of the entire trading day. Argus believes that a fair and representative
price will include trade throughout the day. For refined products in the
US, Argus publishes the low and the high of deals done. In illiquid
markets, Argus looks to assess the range within which product could
have traded, based on bids and offers through the day, movements in
similar grades, and a market consensus following extensive polling of
participants. The Argus assessment is an intelligent range of trade not a
mechanistic system.
Price assessments in Argus US Products rely on a wide variety of
sources for information, including discussion with refiners, marketers,
importers, traders and brokers, and also data from online trading and
auction services. Argus works to verify all deal prices, counterparties,
and volumes. Argus values transparency, so we publish as much price,
volume, and specification information as we discover. This allows you
to cross check and verify the deals against the published prices

at April Nymex +12.00, +12.50 and +13.50. Carb diesel in Los

Angeles traded at April Nymex +23.00, and was offered late in the
day at April Nymex +25.00. EPA diesel was discussed at a 1c/USG
discount to Carb diesel. March jet fuel in Los Angeles was discussed in a wide range of April Nymex +14.00-17.00. April jet fuel
was offered at May Nymex +19.00. Portland diesel traded at April
Nymex +31.00 and April Nymex +33.00, and was talked as high as
April Nymex +36.00.
FUEL OIL: Bunker fuel values in Los Angeles firmed slightly,
nudged upward by rising crude and delays in northwest ports.
Several vessels were seen looking for 380 CST bunker fuel, prices
for which were talked around 335/t. The 180 CST market was
directionless.

The details of our methodology are available at www.argusmediagroup.com or by calling any Argus office.

mn bl

PADD 1 FUEL OIL INVENTORIES

19
18
17
16
15
14
13
12
11
10
1- 5- 9- 13- 17- 21- 25- 29- 2- 6- 10- 14- 18- 22- 26- 1Jan Jan Jan Jan Jan Jan Jan Jan Feb Feb Feb Feb Feb Feb Feb Ma

Stocks

4-week average

refiners in the state produced an average of more than 1mn bl of reformulated gasoline in the week ended 24 February. The data indicated that
refinery turnarounds and unexpected outages have had little impact on
the west coast market. Rbob production is nearly 2pc higher than a year
ago although inventories are about 8.8pc below levels at the same time
last year. California diesel production jumped by 31.5pc from the previous week and inventories also posted a strong gain. A 96,500 b/d refinery
in California that shut briefly over the weekend because of a catalytic
cracker outage was back in operation. A 149,000 b/d California refinery
which was taken offline partially in February will likely remain shut for
at least another month, traders estimate. The shutdown has caused some
tightness in premium gasoline grades and diesel. Gasoline is heard to be
tight in Arizona and Las Vegas, which could potentially have an impact
on west coast values, but the market has not shown any reaction yet.
March 85 Carbob gasoline in Los Angeles traded actively in a range of
April Nymex +19.00 and April Nymex +20.00. April 85 Carbob traded at
May Nymex +19.00. San Francisco 85 Carbob prices firmed and
widened the discount to Los Angeles to 4c/USG. March deals were heard
done around April Nymex +15.50. Portland conventional gasoline traded

Page 6 of 7

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US Products

02 March 2006

NEW YORK AND COLONIAL CLEAN PRODUCT FORWARD CURVES

Differential

Price

87 M New York Barge

Prompt
10 Days Fwd
15 Days Fwd
20 Days Fwd
Any Mar

Apr
Apr
Apr
Apr
Apr

-4.00/-3.50
-4.00/-3.75
-4.00/-3.75
-4.00/-3.75
-4.25/-4.00

165.25/165.75
165.25/165.50
165.25/165.50
165.25/165.50
165.00/165.25

87 A New York Barge

Prompt
10 Days Fwd
15 Days Fwd
20 Days Fwd
Any Mar

Apr
Apr
Apr
Apr
Apr

-5.00/-3.00
-5.00/-3.00
-5.00/-3.00
-5.00/-3.00
-5.00/-3.00

83.7 RBOB New York Barge

Prompt
10 Days Fwd
15 Days Fwd
20 Days Fwd
Any Mar

Apr
Apr
Apr
Apr
Apr

-4.00/-3.50
-4.00/-3.50
-4.00/-3.50
-4.00/-3.50
-4.25/-3.75

93 R New York Barge

Prompt
10 Days Fwd
15 Days Fwd
20 Days Fwd
93 D New York Barge
Prompt
10 Days Fwd
15 Days Fwd
20 Days Fwd
91.3 RBOB New York Barge
Prompt
10 Days Fwd
15 Days Fwd
20 Days Fwd
87 M Colonial
Cycle 15
Cycle 16
Cycle 17
Cycle 18

Apr
Apr
Apr
Apr

Apr
Apr
Apr
Apr

Apr
Apr
Apr
Apr

Apr
Apr
Apr
Apr

+9.50/+10.50
+9.40/+10.40
+9.30/+10.30
+9.20/+10.20

+9.00/+10.00
+9.00/+10.00
+9.00/+10.00
+9.00/+10.00

+9.50/+10.50
+9.40/+10.40
+9.30/+10.30
+9.20/+10.20

+3.80/+4.50
+6.00/+6.75
+6.50/+7.25
+7.00/+7.75

Delta

Differential

+6.13
+6.01
+6.26
+6.51
+6.38

No2 Oil New York Barge

Prompt
10 Days Fwd
15 Days Fwd
20 Days Fwd
Any Mar

Apr
Apr
Apr
Apr
Apr

164.25/166.25
164.25/166.25
164.25/166.25
164.25/166.25
164.25/166.25

+7.01
+7.01
+7.01
+7.01
+7.01

LS Diesel New York Barge

Prompt
10 Days Fwd
15 Days Fwd
20 Days Fwd
Any Mar

165.25/165.75
165.25/165.75
165.25/165.75
165.25/165.75
165.00/165.50

+5.76
+5.86
+5.96
+6.06
+5.91

178.75/179.75
178.65/179.65
178.55/179.55
178.45/179.45

178.25/179.25
178.25/179.25
178.25/179.25
178.25/179.25

178.75/179.75
178.65/179.65
178.55/179.55
178.45/179.45

173.05/173.75
175.25/176.00
175.75/176.50
176.25/177.00

+6.76
+6.76
+6.76
+6.76

+6.26
+6.26
+6.26
+6.26

+6.76
+6.76
+6.76
+6.76

+7.16
+6.88
+7.38

Price

-0.65/-0.30
-0.65/-0.25
-0.65/-0.25
-0.65/-0.25
-0.65/-0.25

Delta

179.84/180.19
179.84/180.24
179.84/180.24
179.84/180.24
179.84/180.24

+5.70
+5.48
+5.23
+4.98
+4.73

Apr
Apr
Apr
Apr
Apr

+14.50/+15.00 194.99/195.49
+14.50/+15.00 194.99/195.49
+14.50/+15.00 194.99/195.49
+14.50/+15.00 194.99/195.49
+14.50/+15.00 194.99/195.49

+7.83
+7.58
+7.33
+7.08
+6.83

Jet 54 New York Barge

Prompt
10 Days Fwd
15 Days Fwd
20 Days Fwd

Apr
Apr
Apr
Apr

+11.50/+12.00 191.99/192.49
+11.50/+12.00 191.99/192.49
+11.50/+12.00 191.99/192.49
+11.50/+12.00 191.99/192.49

+6.08
+5.83
+5.58
+5.33

Jet 55 New York Barge

Prompt
10 Days Fwd
15 Days Fwd
20 Days Fwd

Apr
Apr
Apr
Apr

+14.00/+15.00 194.49/195.49
+14.00/+15.00 194.49/195.49
+14.00/+15.00 194.49/195.49
+14.00/+15.00 194.49/195.49

+7.58
+7.46
+7.21
+6.96

No2 Oil Colonial

Cycle 14
Cycle 15
Cycle 16
Cycle 17

Apr
Apr
Apr
Apr

LS Diesel Colonial
Cycle 14
Cycle 15
Cycle 16
Cycle 17
Jet 54 Colonial
Cycle 15
Cycle 16
Cycle 17
Cycle 18

+0.50/+1.00
+0.50/+1.00
+0.50/+1.00
+0.50/+1.00

180.99/181.49
180.99/181.49
180.99/181.49
180.99/181.49

+5.83
+5.83
+5.83
+5.83

Apr
Apr
Apr
Apr

+9.50/+10.50 189.99/190.99
+9.75/+10.75 190.24/191.24
+10.00/+11.00 190.49/191.49
+10.25/+11.25 190.74/191.74

+6.83
+6.86
+6.88
+6.91

Apr
Apr
Apr
Apr

+9.50/+11.00 189.99/191.49
+9.75/+11.25 190.24/191.74
+10.00/+11.50 190.49/191.99
+10.25/+11.75 190.74/192.24

+7.18
+7.33
+7.46

FOR FURTHER INFORMATION:

PUBLISHER
Adrian Binks
EDITORIAL
Matthew Wood (713) 968-0000, x112
Daphne Tan (713) 968-0000, x116
Huma Khan (713) 968-0000 x106
Keefe Borden (713) 968-0000 x110
Michelle Woods (713) 968-0000 x120
Nisha Giri (713) 968-0000 x104
email:HoustonProducts@argusmediagroup.com
Fax (713) 622 2991

Page 7 of 7

BUSINESS DEVELOPMENT
Daniel Massey (713) 968 0000, X107
email: Daniel.Massey@argusmediagroup.com
SUPPORT
Zachary Rhonheimer (202) 775-0240 x255
email: Zachary.Rhonheimer@argusmediagroup.com
SALES
Karen Johnson, Houston (713) 968-0000, x122
Peter Brown (713) 968-0000 x111
Chris Bozell (713) 968-0000, x119
email: sales@argusmediagroup.com

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COPYRIGHT 2006 BY ARGUS MEDIA LTD. ALL RIGHTS RESERVED. UNAUTHORIZED RETRANSMISSION OR REPRODUCTION PROHIBITED.