Retail gasoline in the U.S. rose the most in 17 months and may surpass year-earlier levels next week following the shutdown of an Enbridge Inc. (ENB) oil pipeline and as crude trades above $90 a barrel.
The national average price for regular gasoline jumped 13.7 cents, or 3.9 percent, to $3.645 a gallon from a week earlier, the U.S. Energy Information Administration said in a report on its website yesterday. That’s the largest weekly gain since March 7, 2011, and the highest since May 28. The level is 0.8 percent less than the same time last year.
U.S. pump prices have risen for the last five weeks and are up almost 21 cents a gallon since June following a rise in crude, which accounts for about 66 percent of the cost of the motor fuel. Gasoline in the U.S. Midwest has also surged after Enbridge shut Line 14, which helps deliver crude to refineries in the region, following a July 27 spill in Wisconsin.
“You’ve got crude up and you’ve got the Enbridge line having a big impact,” James Williams, president of WTRG Economics in New London, Arkansas, said by telephone yesterday. “If we have any increase in crude prices next week, we could match last year’s numbers or exceed it.”
Oil for September delivery traded today as low as $91.82 a barrel, down 0.4 percent, on the New York Mercantile Exchange today. Futures yesterday rose 0.9 percent to settle at $92.20 after U.S. stocks gained and as German Chancellor Angela Merkel’s government backed the European Central Bank’s bond- buying plan, adding to optimism that the region’s debt crisis will ease. Prices are up $3.81, or 4.3 percent, this month.
Enbridge gained approval from the U.S. Pipeline and Hazardous Materials Safety Administration yesterday to resume service on Line 14 in Wisconsin at 80 percent of the pressure at the time of the spill. The company said in an e-mailed statement that the pipeline was expected to return to operations today.
Gasoline futures on Nymex dropped as much as 3.6 cents, or 0.1 percent, to $2.9186 a gallon. Prices slipped 0.9 cent, or 0.3 percent, to $2.9222 a gallon yesterday.
Motor-gasoline inventories fell 2.17 million barrels, or 1 percent, to 207.9 million in the week ended July 27, the Energy Department said. Gasoline stockpiles probably declined 2 million barrels, or 1 percent, to 205.9 million last week, the Bloomberg survey showed.
Average U.S. gasoline demand for the four weeks ended July 27 fell 3.4 percent from a year earlier to 8.76 million barrels a day, the Energy Department data showed.
Gasoline rose the most this week in the U.S. Midwest, surging 25.7 cents to $3.772 a gallon, the Energy Department report showed. Prices only declined in the Rocky Mountain region, where regular gasoline slipped 0.3 cent to $3.463 a gallon, the agency said.
The Energy Department conducts a telephone survey of about 800 retail gasoline outlets across the U.S. each Monday to post weekly gasoline prices as of 8 a.m. local time that day.
To contact the editor responsible for this story: Dan Stets at firstname.lastname@example.org