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Washington state receives rare Japanese gasoline cargo amid local refinery turnarounds

A Japanese gasoline cargo recently arrived in Anacortes, Washington, the first time such a shipment has arrived in the state since at least summer 2015, when S&P Global Platts Analytics started compiling US Customs data of such imports.

US West Coast market sources Monday chalked up this atypical journey to seasonal repair work underway at Pacific Northwest refineries in the US and Canada.

According to the Customs data, the clean tanker Orchid Express brought 78,000 barrels of gasoline from Kashima, Japan, to Anacortes on March 30. Shell was listed as the consignee while JXTG Nippon Oil & Energy of Japan was listed as the shipper.

Data from cFlow, S&P Global Platts’ ship-tracking software, confirms the Orchid Express made this trans-Pacific voyage. The vessel is currently sitting near San Francisco, cFlow data showed.

While it is highly unusual for Asian gasoline to make its way into Washington, it is not unprecedented. The Customs data show that, most recently, gasoline was sent from South Korea to Bellingham on April 26, 2017.

The same data shows that is far more common for gasoline to travel from Vancouver, British Columbia, into Washington. In January, more than 180,000 barrels of gasoline made this journey, with the Canadian division of Parkland Fuels listed as the shipper for all of these barrels.

But with Parkland Fuel’s Burnaby refinery, near Vancouver, now in the midst of seasonal turnarounds, the Customs data shows no Canadian gasoline has entered Washington since the end of January.

Platts refinery data shows the Parkland refinery was taken offline in early February for seasonal turnaround work. A Parkland Fuels spokesman said those repairs were “ongoing” and “near completion.”

Additionally, Platts refinery data show that Andeavor’s 120,000 b/d refinery in Anacortes is scheduled for planned seasonal repairs from April 4 through May 10. Mathew Gill, an Andeavor spokesman, did not immediately reply to an email from Platts seeking comment on the details of those turnarounds.

A USWC market source said that Pacific Coast refinery turnarounds, particularly at Andeavor’s Anacortes facility, explains the unusual arrival of gasoline from Japan. “Usually the Pacific Northwest exports gasoline, unless there is refinery turnarounds,” he said.

A second USWC market source Monday said gasoline traveling from Japan to Washington is “pretty unusual. Some pretty big turnarounds going on the in the Pacific Northwest” probably explain why it occurred. The source said that BP’s Cherry Point refinery, also in Washington, is “totally down.”

Platts refinery data show this 227,000 b/d refinery, the largest in the Pacific Northwest, is down for repairs. It is slated to return to normal operations on May 1, according to Platts refinery data. BP has not returned a request for comment on these turnarounds.

Last week, USWC market sources attributed a tanker carrying gasoline from South Korea into Portland, Oregon — another rare trans-Pacific arbitrage — to turnarounds at BP Cherry Point, a major supplier of gasoline for the area. According to BP’s website, about 90% of this refinery’s output becomes transport fuel.

The combination of seasonal repairs at these various Pacific Northwest refineries seems to be offering some support to cash prices in the Seattle gasoline market. Platts historic data show that the price of unleaded suboctane in Seattle averaged $2.117/gal in the first week of April, more than 13% above the same average from 2017.
Source: Platts

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