Gasoline Declines, Capping First Drop in Five Months
Gasoline capped the first monthly drop since November as reports showing weakness in Europe’s economy added to concern that global demand will slow.
Futures fell with crude, which declined for the first time in seven days, after Spain’s gross domestic product dropped in the first quarter and Italy’s inflation remained at a six-month high. The euro weakened against the dollar, reducing the appeal of commodities as an investment alternative.
“Gasoline is being dragged down by crude oil prices,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. “There’s quite a bit of concern about Spain and Italy. The anticipation is that the economies there will slow and reduce oil demand.”
Gasoline for May delivery fell 2.18 cents, or 0.7 percent, to settle at $3.1844 a gallon on the New York Mercantile Exchange. The price, which dropped 6.1 percent in April, has gained 19 percent this year. The May contract expired today. The more-active June gasoline contract decreased 1.99 cents, or 0.6 percent, to $3.1246.
Spain’s gross domestic product fell 0.3 percent, the same as in the previous quarter, the Madrid-based National Statistics Institute said. Italy’s inflation rate was unchanged at 3.8 percent, Rome-based national statistics office Istat said in a preliminary report.
The euro weakened as much as 0.4 percent against the dollar. The dollar also gained after the Commerce Department said consumer spending in the U.S. climbed 0.3 percent in March, after a revised 0.9 percent gain the prior month, the biggest since August 2009.
“We’re getting the realization that Europe is in a bit of sticky trouble,” said James Cordier, portfolio manager at OptionSellers.com in Tampa, Florida. “All these steps that are being taken are going to weaken the economy.”
Regular gasoline at the pump, averaged nationwide, fell 0.3 cent to $3.816 a gallon yesterday, the lowest level since March 13, according to Heathrow, Florida-based AAA, the largest U.S. motoring club. Prices have dropped 12 cents from the 2012 high of $3.936 on April 4.
May-delivery heating oil climbed 0.27 cent to $3.1834 a gallon. Heating oil for June rose 0.07 cent to $3.1842.
To contact the reporter on this story: Mario Parker in Chicago at firstname.lastname@example.org
To contact the editor responsible for this story: Dan Stets at email@example.com