Some traders who rushed to hire ships to send fuel from Asia to the U.S. after Hurricane Harvey are reconsidering their plans. At least five tankers in the wake of the storm, which knocked out almost a quarter of U.S. refining capacity, have been canceled while some are being diverted elsewhere, data from shipbroker Ocean Freight Exchange show. As Gulf Coast plants restart and prices fall, Latin America may prove a more attractive region, according to industry consultants Energy Aspects and Resource Economist. OFE analyst Rachel Yew said some traders may not have managed to find supplies after making provisional bookings. The cancellations and diversions show how Harvey continues to reverberate across global oil markets even after dissipating. The shutdown of refiners on the Gulf Coast as the storm made landfall in Texas and then once again in Louisiana prompted concern about a fuel shortage, spurring traders to book ships to transport fuel from other regions and fill a potential supply gap. While there are still tankers hired by traders to ferry more than 800,000 metric tons of oil products from Asia, some are being reconsidered. “Some of this material from Asia would be diverted to Latin America and some might be canceled,” said Ehsan Ul-Haq, a London-based director of crude oil and refined products at Resource Economist. “Most of the refining capacity in the U.S. is coming back gradually and Europe has already sent additional barrels of gasoline and other products.” There are signs of a similar picture from Europe. The region’s cargoes of gasoline bound for the U.S. are set to drop to 18 charters over the next two weeks, in line with average levels, according to a Bloomberg survey of three shipbrokers and one owner. That compares with last week’s estimate of 30 cargoes, which was the highest since November. Refinery Restarts About 2.4 million barrels a day, or 13 percent of U.S. refining capacity, has restarted or is restarting operations, data compiled by Bloomberg show. About 12 percent of the U.S. processing capability is still halted. As supply resumes, fuel prices are tumbling, providing less of an incentive for traders to transport cargoes half way around the globe. Moreover, Asian processors are unlikely to have spare cargoes that traders can purchase to ship to the U.S. Most of the plants in the region have already completed September-loading fuel sales, according to Kim Wookyung, a spokeswoman at SK Innovation Co., South Korea’s biggest refiner. “A lot of the traders rushed to fix ships before they had the cargoes, so we saw some ships failing.” said OFE’s Yew. “Also there has been talk of traders unable to find a buyer and this could be due to the gradual ongoing restart of refineries in the Gulf Coast.” The biggest buyers of U.S. refined products, Latin American countries like Mexico and Brazil, have been starved of their typical shipments for more than a week as processors and ports were forced to shut out exports from the U.S. Gulf Coast. After the storm cleared, the first two product-export tankers to leave the Houston area loaded up for Brazil. The two tankers, NS Point and PTI Sextans, are bringing up to 74,000 tons of refined products from the docks in Texas City, Texas, with estimated arrivals between Sept. 17-20. Imports to Mexico’s East Coast that usually come from the U.S. Gulf Coast are instead being supplanted by shipments from Europe and New York, Bloomberg vessel-tracking data show. Gasoline Drop “We expect much of the arbitrage barrels to find their way into Latin American markets,” said Sam Alderson, an analyst at industry consultant Energy Aspects Ltd. “While refineries are beginning restart operations, we still have a sizeable chunk of gasoline and diesel production offline at this stage which, combined with port restrictions, continues to restrict exports of U.S. products.” The window of opportunity to export Asian gasoline cargoes to the U.S. is rapidly closing, according to data compiled by Bloomberg. U.S. prices of the fuel for November delivery in New York traded at discount of more than 25 cents a barrel to prompt Singapore prices, flipping from a premium of about $6 a barrel on Aug. 31. The cost of chartering a ship carrying 35,000 tons of gasoline was about $4.27 a barrel, shipbroker data from Sept. 1 showed. October gasoline futures in New York dropped as much as 3.3 percent to $1.643 a gallon, falling for a third session, on Wednesday. They were at $1.6504 at 10:55 a.m. in New York. The drop comes after prices surged in August by the most in more than a year. “Prices have probably peaked and will continue falling as the panic in the market subsides and supply improves, thereby closing some of the product arbs into the U.S.,” said Den Syahril, an analyst at FGE in Singapore. “Of course, the uncertainty is how long the refineries which have yet to restart will take to come back into the market.”