OREANDA-NEWS. US Gulf coast diesel differentials rose by 2¢/USG this morning, as the Colonial Pipeline halted operations at its Cedar Bayou storage and terminal facility in Houston, Texas, because of flooding over the weekend.

The shutdown has created a diesel shortage as buyers are unable to get barrels out of storage. The pumping station, which loads diesel onto line 2 of the pipeline, is closed as well. Colonial's other facility in Pasadena, Texas, continues to operate.

Diesel nominations for originating and delivering at Cedar Bayou are cancelled for 60th and 61st cycles. The 60th cycle was originally scheduled to pump today, while the 61st cycle was originally scheduled to start on 8 November and end 12 November. More rain is expected in the region later this week.

Ultra-low sulphur diesel (ULSD) on the 61st cycle traded from November Nymex -7.5¢/USG up to -5.5¢/USG in the course of the morning session, and the prompt cycle roll was done from +0.5¢/USG up to +1.5¢/USG.