PBF takes wary approach to fuel rebound

Emerging US fuel demand will not quickly restore crude consumption, US independent refiner PBF Energy warned today.

The company planned to restart or reconfigure fuel producing units to meet rising gasoline demand and limit output of lower-demand diesel and jet fuels, the company said in a quarterly earnings call. That work would not significantly raise crude rates as the industry warily manages product stockpiles.

"Our competitors, in their calls, have recognized and acknowledge that they are not going to swallow the bait," said PBF chief executive Tom Nimbley. "They are going to be very tempered in making sure that any recovery in demand is going to be sustainable before they increase runs."

A fluid catalytic cracking (FCC) unit idled for weeks beginning in March at PBF's 170,000 b/d refinery in Toledo, Ohio, would soon restart to produce gasoline, PBF said. But cracking diesel into gasoline and other unusual, inventory-controlling methods would only increase crude throughputs there by 2,000-3,000 b/d, Nimbley said.

The company's 157,000 b/d Martinez, California, and 190,000 b/d Chalmette, Louisiana, refineries managed to operate their FCCs at lower levels than previously thought. PBF shut diesel-focused hydrocracking units at Martinez and its 190,000 b/d refinery in Torrance, California.

The refiner slashed jet fuel production by more than 90pc, from 90,000 b/d to 8,000 b/d. PBF may use hydrocrackers to process jet fuel or other distillates into some gasoline going forward if demand requires it.

The company estimated second quarter throughputs of 650,000-750,000 b/d or 70pc of capacity. PBF did not break out regional crude processing estimates for the quarter.

Low product demand would keep narrow crude quality discounts for heavy crudes compared to light, and for sour crudes relative to sweet, Nimbley said. Neither Mexico's Maya heavy sour or Saudi Arabia's medium sour exports were competitive in the US market. Canadian heavy, sour crude faced "a tough business" without demand, he added.

A slow recovery in US light, sweet production and faster pick up in product demand would widen those differentials again. Medium sour crudes would become the swing barrel.

But all of that would be led from a recovery in fuel demand, he said.

"One of the things we should really learn from what we have seen here, and I am not sure we will, is that crude has no value unless it can find its way inside a refinery," Nimbley said.

By Elliott Blackburn

News No: 9502
Date: 2020/05/15 - 19:10
News Source: Argus Media

PBF  fuel  Energy  US  refinery 


Leave a Comment:


10 investment holdings to be established in industry, mining sectors

Iran's Deputy Industry, Mining, and Trade Minister Saeed Zarandi announced the establishment of 10 investment holding companies in the industry and mining sectors in near future, IRIB reported on Monday.

Salehinia appointed as head of IDRO

In a decree on Sunday, Iranian Industry, Mining, and Trade Minister Alireza Razm Hosseini appointed Mohsen Salehinia as the new head of Industrial Development and Renovation Organization of Iran (IDRO), IRNA reported.

IME’s weekly worth of trades up 90%

Value of trades at Iran Mercantile Exchange (IME) rose 90 percent during the past Iranian calendar week (ended on Friday), IME International Affairs and Public Relations Department reported.

Ports operating non-stop despite sanctions, pandemic

While the coronavirus pandemic has created many limitations for the economic activities all around the world, operations at Iranian ports are underway continuously, and even the U.S. sanctions could not halt activities at the ports.

Steel exports exceed 2.3m tons in 6 months

Iranian steel producers exported 2.358 million tons of steel ingots and products during the first six months of the current Iranian calendar year (March 20-September 21), IRNA reported.

Iran-Afghanistan 6th Joint Economic Committee meeting due in late Oct.

Iranian Energy Minister Reza Ardakanian held talks with Afghan Acting Foreign Minister Mohammad Haneef Atmar through video conference on Saturday in which the two sides discussed the two countries’ Joint Economic Committee meeting which is due to be held on October 25.
Upcoming Events
 Mines & Metals

Mine & Business Today

 Scrap & Recycling


Our partners