Crude-oil and refined products futures were higher Tuesday on continued tensions in the Mideast and another Ukrainian drone attack on a Russian refinery.

Reuters reported Ukrainian drones hit Tatneft's 340,000 b/d Taneco refinery in Russia. The facility is about 800 miles behind the front lines between the two countries.

In addition, a Monday fire at Phillips 66's 149,000 b/d Borger refinery in Texas and Neste's announcement that it is beginning a major turnaround at its Porvoo refinery in Finland are helping support refined product prices, particularly diesel.

Trade sources said refineries have completed shifting yields toward gasoline, based in part on strong demand in Latin America and India.

From a macroeconomic standpoint, the Institute for Supply Management on Monday reported an expansion of U.S. manufacturing in March and if the European Union's economy can get off the ground that could lead to tighter petroleum product supply over the second half of 2024.

The NYMEX May ULSD contract was up by nearly 8cts to $2.7036/gal. The contract pulled back slightly, but remained 6.85cts higher at $2.6956/gal near midday.

The NYMEX May RBOB contract, which gave back just over 1ct on Monday, was about 2cts higher at $2.7281/gal. Earlier in Tuesday trading, the contract was up by nearly 4cts/gal.

Most cash markets were tracking futures gains, with the West Coast again a standout, as premiums to the NYMEX in Los Angeles and San Francisco at 50-60cts. Crude-oil futures were more than $1 higher with the NYMEX May West Texas Intermediate contract just above $85/bbl. The June Brent contract was just shy of $89/bbl.

Crude futures were finding support from continued geopolitical tensions and Monday's announcement from Mexican state-owned oil company Pemex that it would halt some crude exports over the next several months.

The May WTI contract traded as high as $85.46/bbl, but backed off that by midday to $84.88/bbl, up $1.17. Brent futures last traded at $88.67/bbl, $1.25 higher, after reaching a morning high of $89.08/bbl.


This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.


-- Reporting by Denton Cinquegrana, dcinquegrana@opisnet.com; Editing by Jeff Barber, jbarber@opisnet.com


(END) Dow Jones Newswires

04-02-24 1313ET