Traders Divert 20 Gasoline Tankers to U.S. Gulf Coast

By Alaric Nightingale and Nidaa Bakhsh

Sept. 16 (Bloomberg) -- Gasoline traders diverted about 20 tanker loads of the fuel headed for New York to the Gulf of Mexico after hurricanes Gustav and Ike reduced southern U.S. refinery output, said Fearnleys A/S, an Oslo-based shipbroker.

Gustav and Ike forced a total of 6.3 million barrels a day of refining capacity to shut in Louisiana and Texas. Each of the diverted vessels is transporting about 37,000 metric tons of cargo and the decisions to change course were taken last week, Truls Dahl, a shipbroker at Fearnleys, said by phone today.

``A lot of vessels will end up'' in the Gulf of Mexico, Dahl said, adding that so far, he's seen no extra demand from traders to ship European gasoline across the Atlantic to take advantage of higher U.S. fuel prices after the storms.



Refiners and traders can earn as much as $1.44 a gallon sending product from northwestern Europe to the U.S. Gulf Coast, according to data compiled by Bloomberg. That's three times as much as at the start of the month.

Fearnleys arranged for four vessels to be diverted south out of a total of about 20 that have been switched so far, Dahl said. That would equate to about 6.3 million barrels of gasoline, or 3.3 percent of U.S. gasoline inventories of 188 million barrels, based on Department of Energy Data.

Exxon Mobil Corp., the world's biggest oil company, said yesterday it was importing gasoline from refineries in Europe, the Middle East and Asia to meet a shortfall in U.S. supplies.

More than 27 million barrels of fuel products haven't been produced because of the hurricanes, the U.S. Energy Department said in a statement yesterday. Of that, nearly 13 million barrels is gasoline and about 9 million barrels are distillates such as diesel and heating oil.

Gasoline stockpiles in the U.S. are at the lowest since the end of 2000, according to Energy Department data.

To contact the reporter on this story: Alaric Nightingale in London at Anightingal1@bloomberg.netNidaa Bakhsh in London at o nbakhsh@bloomberg.net