Colonial gasoline line space flips positive

Market: Freight, Oil products
10/05/21

The value of gasoline line space on the Colonial Pipeline's main gasoline-bearing Line 1 pressed into positive territory this morning for the first time in nearly 15 months.

Shippers with contracted space to move fuel on Colonial that do not need it during a given time period will sell it to others on the so-called line space market. This allows them to preserve their space on the pipeline in the future.

Line space trades involve a sale of the commodity at a line segment's origin and a purchase of the same commodity at a destination point, which cancels out the original sale. The difference between the two determines the prices for line space.

Uncertainty surrounding the current state of the Colonial Pipeline following last week's ransomware attack has led to price increases along the Atlantic coast, widening inter-regional spreads. Demand appears to be strongest in the US southeast, which relies more heavily on Colonial shipments.

Demand to ship along the Colonial Pipeline's 5,500-mile length, running between Pasadena, Texas and Linden, New Jersey, has been notably muted for more than a year, with arbitrage between the Gulf and Atlantic coasts having remained mostly unattractive on paper since early last year.

For arbitrage to be profitable on paper, spreads between Pasadena and Linden must exceed the 5.98¢/USG cost of shipping product on the line.

This morning, bids for prompt line space rose to flat while offers materialized at the +0.5¢/USG level, lifting values notionally into positive territory for the first time since 18 February 2020.

Prompt cash differentials versus the Nymex RBOB basis for gasoline blendstocks in the Gulf coast were down by 0.38¢/USG in daily comparison. Overall trade activity was muted during the early hours of the day as participants await further news.

The disruption to the pipeline's system occurred on 7 May at the beginning of prompt trading for Colonial cycle 29, a five-day pricing cycle. The length of prompt trading for a Colonial cycle will generally vary between three and five business days, though index pricing for the cycle is determined during the final three days of trade.

By Paul Dahlgren

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16/11/24

Cop: Parties continue slow work on finance goal: Update

Updates throughout Baku, 16 November (Argus) — Parties at the UN Cop 29 climate talks in Baku have asked for more time to work on "specific proposals" for a new finance goal, working from a draft text released yesterday , but it is unlikely to yield progress on key sticking points. Country representatives are seeking to agree on a new climate finance goal for developing nations, following on from the current — broadly recognised as inadequate — $100bn/yr target. A plenary is due to take place later today in Baku. "Over the last few days some people have doubted whether collectively we can deliver. It is time for the negotiators to start proving them wrong," Cop 29 deputy lead negotiator Samir Bejanov said. The current draft text still fails to bridge the huge divide between developed and developing countries on key issues such as an amount for the goal, the contributor base and what the funds should be used for. And the new version due to come out today is unlikely to show meaningful progress on these issues, observers suggested, leaving them for ministers to tackle next week. Technical negotiators continue to try and move forward on topics such as funds' access and transparency. Developed countries have still not proposed a number for the goal, and want the contributor base broadened. Developing countries remain broadly united in calling for climate public finance of over $1 trillion/yr. Options show that developing country parties seek a new finance goal that serves mitigation — actions to reduce emissions — adaptation and loss and damage. Adaptation refers to adjustments to avoid global warming effects where possible, while loss and damage describes the unavoidable and irreversible effects of such change. Developed nations are also pushing for sub-targets of $220bn/yr for least developed countries (LDCs) and $39bn/yr for small island developing states (Sids), in which money for adaptation should come in the form of grants and highly concessional finance and funding for loss and damage "primarily in grants". Multi-layered The multi-layered approach in the draft, mostly supported by developed countries, does not mention loss and damage. On broadening the contributor base, it has options calling on "parties in a position to contribute" or "all capable parties" to "mobilise jointly $100bn/yr for mitigation and adaptation in developing countries by 2035". The UN climate body the UNFCCC works from a list of developed and developing countries from 1992 — delineating 24 countries plus the EU as developed — and many of these note that economic circumstances have changed in some countries, including China, over the past 32 years. China between 2013 and 2022 provided and mobilised $45bn in climate finance to developing countries, equivalent to 6.1pc of climate finance provided by all developed countries in the period, according to think-tank WRI. A few options in the multi-layered approach in the draft talk about "investments", language that developing countries do not support, and "investing trillions "from all sources, public, private, domestic and international". Developing nations are not against private sector financing, but they want the main figure for the new finance goal to come from public sources, observers said. Some parties on both sides are calling for an acceleration of the reforms of multilateral development banks, key to leverage billions in private sector finance, as well as for the use of taxes and levies. But these issues are largely outside of the remit of the Cop, even though they may get a boost from the upcoming G20 leaders summit on 18-19 November. UN climate body chief Simon Stiell today called on G20 to ensure the availability of more grant and concessional finance, make progress on debt relief, and push for additional multilateral development bank reforms. Brazil is looking to use its G20 presidency to advance agreement on energy transition finance, having set fighting climate change as one of its priorities. The country called for a global finance governance that includes rules for financing a "just and equitable" energy transition in developing economies and for an easier access to climate funds. Brazil has also pushing for a 2pc tax on billionaires that could generate up to $250 bn/yr in revenue. By Victoria Hatherick, Jacqueline Echevarria and Caroline Varin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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16/11/24

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16/11/24

Cop: Colombia’s climate plan to address fossil fuels

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Cop: Parties continue work on new finance goal

16/11/24

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16/11/24

Cop: Parties continue work on new finance goal

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Cop: UN’s Stiell urges G20 to make climate its priority

16/11/24

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16/11/24

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Adv Fame marine blend premiums to fossil hit year lows

15/11/24

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15/11/24

Adv Fame marine blend premiums to fossil hit year lows

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