Gasoline on the East Coast weakened the most in six months with the approach of a seasonal grade change and after inventories rose for a fourth week.
Stocks of gasoline made to East Coast specifications increased 206,000 barrels in the region to 16 million last week, the highest level since July 20, the Energy Department said today. Total gasoline supplies on the East Coast increased 229,000 barrels to 50.1 million. This week winter-blend gasoline will be available for sale at terminals in the region.
“Prices are falling substantially” as the market switches to a winter grade of gasoline that refineries can make for much less than the cost of summer blends, said Andy Lipow, president of Lipow Oil Associates LLC in Houston.
The premium for reformulated, 87-octane gasoline, or RBOB, in New York Harbor dropped 16.5 cents to 24 cents a gallon versus futures traded on the New York Mercantile Exchange at 1:57 p.m., according to data compiled by Bloomberg. Prompt delivery fell 20.34 cents to $3.2451 a gallon.
Fuel used in warmer weather must have a lower Reid vapor pressure, or RVP, a measure of volatility expressed in pounds per square inch, or psi.
Gasoline rose in northwest Europe, reducing the incentive to ship the fuel, as prices for immediate loading in Amsterdam- Rotterdam-Antwerp traded from $1,151 to $1,157 a ton, according to a survey of brokers and traders monitoring the Argus Bulletin Board. That compares with $1,143 to $1,146 yesterday. Gasoline imports to the East Coast declined 243,000 barrels to 699,000 barrels last week, government data showed.
The premium for RBOB in the Gulf Coast slipped 3.25 cents to 7.75 cents a gallon, the lowest level since Aug. 23. Total gasoline inventories in the Gulf Coast fell 1.39 million barrels to 65.1 million barrels.
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