Gasoline had a margin month, not a flat-price month. RBOB NYH barges averaged 328.58 cpg against June's 303.11 (+8.40% MoM, +51.6% YoY), but the work was done in the crack: NYH 3-2-1 averaged 62.44 per barrel from 47.28, +32.07% MoM, close to four times the flat-price move. The gas leg split in two. Propane fell 7.29% MoM to 69.74 cpg, alone among the NGLs, while butane rose 1.48%, isobutane 7.53% and natural gasoline 8.91%. The split is octane: alkylate rose 4.94% MoM and isobutane closed at its monthly high of 139.00, while summer RVP specification limits how much butane can go into the gasoline pool.
MARKET ACTIVITY
- Aggregate spot volumes confirm where the bid was.
- Alkylate aggregate traded volume was 325,000 bbl against June's 125,000 (+160.0% MoM), the largest proportional gain in the set, while CBOB A2 at Colonial Pasadena was flat at 50.94 million bbl (+1.8%). Base-grade gasoline liquidity did not move; the octane components did. Volumes are aggregates of the month's trades, not published index volumes.
PRICE ACTION
- Flat gasoline rose 8.40% but the crack rose four times as fast, and both gave the move back in the last two weeks.
- RBOB NYH barges opened 308.52 cpg, closed 312.17, averaged 328.58 against June's 303.11 (+8.40% MoM, +51.6% YoY against Jul-25's 216.72); high 343.47 (22 Jul), low 287.27 (2 Jul).
- RBOB Colonial Pasadena averaged 312.92 cpg (+6.20% MoM) and CARBOB Los Angeles 349.65 (+6.79%), so the coasts moved together and neither led by much.
- The close is the tell: NYH barges finished 312.17 against a 328.58 average, and the NYH crack closed 49.02 after an 11.95 per barrel single-session collapse on 31 July from a 69.42 high on 17 July. Gasoline gave back its margin late while the average still printed strong.
CROSS-MARKET DYNAMICS
- The barrel paid for octane and for the heavier NGLs, and stopped paying for propane.
- Propane at Mont Belvieu averaged 69.74 cpg, -7.29% MoM, the only NGL lower on the month, and it carried the lowest dispersion in the set at 3.37 CV. Cheapening on the quietest tape in the complex is what length that is not clearing looks like: no urgency on either side of it.
- Isobutane averaged 112.22 cpg (+7.53%) and closed at its monthly high of 139.00, a 45.62 cpg range; alkylate averaged 336.37 cpg (+4.94%).
- Natural gasoline averaged 180.75 cpg (+8.91%), opening 153.06 and closing 198.03, and tracked naphtha rather than propane: heavy naphtha USGC averaged 238.66 cpg (+6.24%), light straight run 251.66 (+7.81%).
CROSS-REGIONAL DYNAMICS
- The two coasts set the extremes and the interior moved as one.
- RBOB NYH barges averaged 328.58 cpg against RBOB Colonial Pasadena at 312.92, a 15.66 cpg premium to the Gulf, while RBOB Colonial Linden averaged 325.86.
- CARBOB Los Angeles at 349.65 cpg was the highest average in the set and CBOB West Shore Chicago the lowest at 305.76, a 43.89 cpg spread across the country.
- Group Three suboctane averaged 307.39 cpg against Chicago CBOB at 305.76, so the interior tracked itself closely rather than following either coast.
- NYH also led on the month at +8.40% MoM against Chicago West Shore at +5.91%, the weakest in the set, so the coastal premium widened as well as being the highest.
CURVE STRUCTURE
- Backwardated throughout, with the prompt easing while the back widened.
- On the Colonial Pasadena RBOB curve, M1-M2 narrowed from 17.20 cpg at month-start to 10.47 at month-end, while M1-M6 was little changed at 72.76 from 73.30 and M1-M12 widened from 55.74 to 64.80.
- The curve stayed backwardated at every tenor on both dates, so the easing in the prompt spread is a narrowing of an existing backwardation rather than a flip.
PRICE VOLATILITY
- Flat gasoline stayed calm while the gas leg got noisy, inverting June's pattern.
- June's relationship reversed: flat RBOB CV rose only to 4.47 from 2.83 while the crack CV halved to 7.72 from 15.15, so the margin was the calmer exposure. Hedges sized on June's crack vol are now oversized.
- The volatility moved to the gas leg, natural gasoline at 12.00 and isobutane at 11.77 both at or near six-month highs, and both are the products the barrel was competing for. Propane's 3.37 was the lowest in the set: a surplus product trades quietly, which is itself the signal.
SOMETHING TO WATCH
- The September RVP change against a butane pool at the top of its range:
- Observation: butane closed 108.79 cpg and isobutane at its monthly high of 139.00, both going into the seasonal RVP change near the top of their July range.
- Why it matters: from mid-September the cap lifts and cheap butane returns to the pool. Butane entering that transition at a monthly high rather than a seasonal discount changes blender economics and usually compresses the front of the gasoline curve.
- What to monitor: the mid-September RVP transition at terminals; butane against RBOB at Colonial Pasadena.
- Propane into the heating-season build:
- Observation: propane fell 7.29% MoM, alone among the NGLs, on the lowest dispersion in the set at 3.37 CV, while isobutane rose 7.53% and natural gasoline 8.91%.
- Why it matters: propane cheapening while every other NGL is bid points to length that is not clearing ahead of the October to March draw season. If it is still there in the fall it caps the winter rally, and the 30 September inventory print is the recurring marker on this desk.
- What to monitor: EIA weekly propane and propylene stocks; Belvieu propane against Conway; propane against butane at Belvieu.
- The ethane fractionation spread:
- Observation: more than doubled to 3.68 cpg from 1.64 and closed at 5.87, its highest print of the month.
- Why it matters: a widening frac spread pulls ethane out of the gas stream, lifting recovery and reducing the heavier NGL share, so it works against the butane and C5 strength that defined July.
- What to monitor: the published fractionation spread; Belvieu ethane against Henry Hub on a BTU basis.
Note: All figures, prices and market activity referenced in this report are based on the period covered by this monthly update.
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