US Cash Products-Harbor gasoline extends declines

* Harbor gasoline down on better supply
* Chicago gasoline up, traders discount pipeline spill
* Gulf diesel higher on new cycle

HOUSTON, July 19 (Reuters) - Gasoline differentials in the New York Harbor
extended declines on Thursday as improved supplies and cheaper values of
forward-month futures contracts on the New York Mercantile Exchange weighed on
basis values, traders said.
New York Harbor M2 conventional gasoline fell 4.25 cents a gallon to
10.50/10.00 cents under the August RBOB gasoline futures contract, traders said.
F2 RBOB gasoline for prompt delivery, which fell 3.00 cents a gallon in late
trading on Wednesday, was about 0.40 cent higher at 8.35 cents over August RBOB
futures.
"Cash markets are weaker because there are a couple of barrels too many in
the market," a Harbor trader said.
"Also because of the backwardation, sellers will have to discount barrels to
get them moved," the trader added, referring to the September futures' discount
against the August contract.
The spread between the August and September futures contract narrowed
slightly on Thursday with September futures trading at a 9.00-cent discount
against their August counterpart in the afternoon. RBc1-RBc2
In the Midwest, Chicago CBOB gasoline rose 1.50 cents a gallon to 21.00
cents under August NYMEX RBOB futures, wiping out Wednesday's 1.50-cent drop.
Traders reported a spill on Buckeye's West Shore refined products pipeline
in Wisconsin but said it had little bearing on differentials. Buckeye Partners
LP, which owns West Shore, did not respond to requests for comment.
In the Group Three market, ultra-low sulfur diesel differentials rose a cent
a gallon to 10.00/10.50 over futures.
Phillips 66 said on Thursday that it completed planned maintenance
at its 198,400 barrel-per-day refinery in Ponca City, Oklahoma. The company had
reported starting the turnaround earlier this month.
On the Gulf Coast, ULSD differentials gained 0.75 cent per gallon to a
bid-offer spread of 6.50/7.00 cents over August heating oil futures on the NYMEX
as traders focused on a new five-day lifting cycle.
Gulf jet fuel differentials rose by 1.75 cents per gallon to 8.00/9.00 cents
over on thin liquidity in a market controlled by a handful of traders.

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Latest day
Timing NYMEX Bid Offer Change
Contract
U.S. GULF COAST <0#P-USG> * Scheduling
M2 conventional gasoline Cycle 42 RBOB -19.75 -19.25 0.00
61-grade ULSD Cycle 42 HO 6.50 7.00 0.75
54-grade jet fuel Cycle 42 HO 8.00 9.00 1.75
Heating oil Cycle 42 HO -4.50 -3.50 0.00

NEW YORK HARBOR <0#P-NYH>
M2 conventional gasoline Prompt RBOB -10.50 -10.00 -4.25
Any-Month RBOB -0.25 0.25 3.00
F2 RBOB Prompt RBOB 8.25 8.50 0.40
Any-Month RBOB 3.00 3.50 -1.25
ULSD Prompt HO 9.50 10.50 0.00
Any-Month HO 9.50 10.50 0.00
Heating oil Prompt HO 0.00 1.00 0.00
Any-Month HO 0.00 1.00 0.00
Jet fuel Prompt HO 13.00 13.50 0.25
Any-Month HO 13.00 13.50 0.25
MIDWEST <0#P-G3> <0#P-MC>
Chicago CBOB gasoline Cycle 3 RBOB -22.00 -20.00 1.50
Chicago ULSD Cycle 3 HO 1.00 2.00 1.00
Group Three gasoline RBOB -5.75 -4.75 -0.25
Group Three ULSD HO 10.00 10.50 1.00

(Reporting by Kristen Hays in Houston and Selam Gebrekidan in New York; editing
by Jim Marshall)