Best way to play gas

If you believe gasoline is going higher, then a refiner would be ideal as long as oil is relatively cheap. If oil prices run up, then the refiners will be less profitable, in that case drillers and integrateds might be a better choice. Rbob has run for a while now though, the bulk of the move may have already been made.

If you are long, I think it's too late to get into the refiners. I bought VLO in august and was in the house of pain through the fall and winter. That is the best time to buy the refiners: hurricane season is over, people are travelling less, things are quiet. If you get in now, you probably have a 5 to 10 pt. upside and that's it. There are better stocks out there with better upside right now.

Houston, TX - The NYMEX oil complex finished the day below yesterday, but off their intraday lows as June RBOB gasoline made a late day recovery on this morning's EIA data. The late rally in gasoline pulled the other two oil based NYMEX contracts with it, despite inventory data that was viewed as largely bearish. Gasoline recovered on the basis of the EIA report, sources say, which revealed another drop in inventories of 1.1 million barrels.
We view the gasoline data as mixed at best. While there was another decline in gasoline stocks, the good news for gasoline was the fact that production increased by 241,000 bpd with only a small improvement in refinery operation form the previous week. Refinery runs were estimated at 88.3% for the week ending April 27 versus 87.8% for the week of April 20. We believe that as refinery operations improve to above 90% levels, gasoline output will increase, thus allowing stocks to rebuild in time for the summer driving season.
Crude and distillate fuel stocks were within most analysts projections and price movement will be directed by gasoline in the days ahead.

June crude settled at $63.68 per barrel $0.72 lower than Tuesday's settlement of $64.40 per barrel. June NYMEX RBOB gasoline settled at $2.2326, 1.21 cents per gallon below yesterdays' $2.2447 settlement. The June NYMEX heating oil contract settled at $1.8526 per gallon, down 3.03 cents per gallon from Tuesday's settlement of $1.8829.
June domestic crude trade activity was described as a little dull with only a few deals confirmed done, there was no shortage of rumors. Light Louisiana sweet was reported done at a $4.85 and $5.00 premiums to WTI while Heavy Louisiana sweet was rumored done from $2.80 to $3.50 premiums. West Texas sour was reported at a $7.00 discount to WTI and possibly a $6.80 discount. Mars heavy sour was reported done at a $3.50 discount to WTI while Poseidon sour was rumored done at a $4.20 discount.
Cash product trading was thin although there was impression that gasoline the Midwest, including Chicago, was tight, and will remain so for the short-term. The concern has translated into sharply higher premiums for gasoline in the region with Group regular gasoline talked near an 18 cents per gallon premium to the June NYMEX RBOB while Chicago regular is at or slightly better than a 25 cents per gallon premium to the NYMEX. A few sources said they understand that the tight gasoline supply problem is being addressed with expectations that additional supplies are already being scheduled from the Gulf Coast which should mitigate the problems.
The June paper Brent market last traded at $66.43 per barrel.

LOS ANGELES (Dow Jones)--After 11 weeks of planned maintenance and unplanned outages at Exxon Mobil Corp.'s (XOM) 155,000 barrel-a-day refinery in Torrance, California, the company began taking another unit down early Tuesday morning, according to company spokeswoman Carolin Keith.
Keith wouldn't say which unit was being taken out of service, but spot Los Angeles carbob gasoline rose a dramatic 7.5 cents a gallon in late afternoon trading.
Morning deals were done at 43.0 cents and 44.5 cents over June Nymex RBOB gasoline, but late afternoon deals were done all the way up to 52.0 cents over RBOB gasoline.
Tuesday's Los Angeles carbob gasoline settlement of $2.755 is the second highest settlement price ever recorded, with the highest price recorded exactly one year ago at $2.94/gallon.
It wasn't known when the downed unit would be put back into service.