OIL PRODUCTS: Valero Not Facing Impact from Dangote Ramp-Up

Valero COO Gary Simmons on Atlantic Basin/U.S. products:

• Dangote refinery: “I think from what we can see and what we read, they do have their resid FCC up and running. We see that commercially. They're not offering out the fuel or the resid that we were buying from them. We also see less imports of gasoline into West Africa, which is all consistent with Dangote continuing to ramp-up.”
• “With that though, however, what we've seen is that generally tends to impact Europe more than it does the US a gasoline that was going to -- West Africa gets backed into Europe. We haven't really seen much of an impact from that.”
• “Diesel has been somewhat interesting. The cold-weather in the US kind of has the US market strong. So you actually see a few cargoes from Europe actually booked into New York Harbor, which is an abnormal trade flow. We do see that correcting when you get to the second-half of February, and we're already seeing an open arm to export back from the US to Europe.”
• “So nothing too abnormal on-trade flows. I think by and large, what you've seen is that the Dangote startup in the North Atlantic Basin has been largely offset with Lyondell coming down and Grangemouth coming down and they're kind of counterbalancing each other and keeping trade flows about what we've seen historically.”