UPDATE 1-Hovensa completes Virgin Islands refinery shutdown
NEW YORK, Feb 21 (Reuters) - Hovensa LLC completed shutdown of its 350,000 barrel-per-day St. Croix, U.S. Virgin Islands refinery on Tuesday, the company said in a statement. The complex will be operated as an oil storage terminal. "Hovensa's operation of the complex as an oil storage terminal is subject to the completion of negotiations with the Government of the Virgin Islands," the company said. Losses at the Hovensa refinery, owned by Hess and Venezuelan state oil company Petroleos de Venezuela, totaled $1.3 billion over the past three years and were projected to continue. The company had announced the refinery shutdown on Jan 18. On Tuesday, when Hovensa said the shutdown was complete, the markets focused on geopolitical tensions in the Middle East, the Euro and the strength of the S&P 500. [O/R} March RBOB futures ended the day up 1.81 percent at $3.066 per gallon and the cash market in the New York Harbor saw values of either side of 4.00 cents per gallon under the screen. The 46-year-old refinery was once one of the largest plants in the Americas, with 500,000 bpd capacity. The company idled 150,000 bpd of older, less efficient units in 2011 on the West Side of the plant. Sluggish oil demand growth in the United States and Europe, growing competition from new, advanced Asian refineries and spike in the price of Atlantic Basin Brent-based crude oil relative to inland U.S. grades has devastated refining margins for many older East Coast and European refiners. The U.S. East Coast is now facing a tight summer gasoline supply outlook. In September, ConocoPhillips and Sunoco Inc. announced they would close three refineries with nearly 700,000 bpd of capacity in the region, two plants have already been idled, and Sunoco's 335,000 bpd Philadelphia refinery is slated for closure if no buyer is found.