Base Oil Price Report


Citgo Petroleum Corp. said its Cit-Con base oil refinery continues to operate normally despite disruption of crude oil supplies from strike-hampered parent Petroleos de Venezuela S.A.

A United States congressman warned yesterday that two Citgo refineries – one of them the Lake Charles, La., complex that includes the Cit-Con refinery – could run out of oil by the end of the month because of a 22-day strike at PDVSA.

Venezuela is the largest oil producer in the Western Hemisphere and the fourth-largest supplier of U.S. imports, but its production has dwindled by 90 percent since employees of state-owned PDVSA walked off their jobs Dec. 2. Citgo, based in Tulsa, Okla., is PDVSAs refining and marketing arm in the United States. The Cit-Con refinery, its only base oil plant, has capacity to produce 9,500 b/d of Group I stocks and 800 b/d of wax.

The warning by Louisiana Republican Billy Tauzin was included in a letter asking the U.S. Dept. of Energy to tap the nations Strategic Petroleum Reserve to make up for the cutoff of deliveries from Venezuela. The department said it does not support opening the reserve at this time, but would consider it an option in the future.

Citgo acknowledged Tauzins request on its behalf but downplayed the notion of its predicament being serioius.

Our refinery operations really havent been affected, spokesman Kent Young told Lube Report. He acknowledged that Citgo normally receives a good portion of its crude feedstock from PDVSA but maintained that it has been able to fill the supply gap with spot purchases.

The strategic reserve is just one of our options, Young said. Were always doing business on the spot market, so theres really nothing new about that. Again, our refineries are not affected. Young refused, however, to speculate about whether or when they would be affected if the strike continues.

Meanwhile, the strike has driven crude costs to their highest levels in almost two years. The price of crude on the New York Mercantile Exchange rose $1.45 per barrel yesterday to close at $31.75. Posted base oil prices were unchanged this week.

Historic U.S. posted base oil prices and WTI and Brent crude spot prices are available for purchase in Excel format.

Copyright 2002 LNG Publishing Co., Inc. All rights reserved.
Tim Sullivan, Editor. Lube Report, Lubes’n’Greases Magazine and Lubricants Industry Sourcebook are published by LNG Publishing Co., Inc.

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