Gasoline rose to the highest level in almost five months on concern that refinery shutdowns in the Atlantic Basin will further reduce stockpiles on the U.S. East Coast.
Prices climbed the most since June 29 as Europe’s largest refinery, Royal Dutch Shell Plc’s 400,000-barrel-a-day Pernis plant in the Netherlands, is conducting maintenance until early November. Supplies on the East Coast, including New York Harbor, the delivery point for futures contracts, were the lowest since October 2008 last week, Energy Department data show.
“You’re losing a significant amount of Atlantic Basin supply,” said Andrew Lebow, a senior vice president at Jefferies Bache LLC in New York.
Gasoline for October delivery rose 6.79 cents, or 2.2 percent, to $3.149 a gallon at 1:09 p.m. on the New York Mercantile Exchange. Prices touched $3.2086, the highest intraday price for the front-month contract since April 30. Prices are up 15 percent since June.
The premium of the front month over later months, known as backwardation, is the largest since Sept. 1, 2005. The October contract, which expires tomorrow, was 24.5 cents over November as of 1:10 p.m.
U.S. gasoline inventories fell 481,000 barrels to 195.8 million barrels last week, the ninth consecutive decline and the lowest level since October 2008, according to department data. Output slid 2.1 percent to the lowest level in 10 weeks.
“You have tight supply in the Harbor, coupled with refinery outages and slowdowns and you’re heading into maintenance season,” said Dan Stauffer, an over-the-counter energy broker at INTL FCStone Inc. in New York.
Irving Oil Corp. is performing maintenance on sections of the 298,800-barrel-a-day Saint John refinery in New Brunswick, which exports more than half of its production to the East Coast.
Valero Energy Corp. shut all the main production units, including the fluid catalytic cracker and coker, at its Pembroke refinery in Wales while the plant’s only crude unit undergoes an eight-week turnaround.
The refinery maintenance at St. John, Pernis and Pembroke may further reduce shipments to the East Coast. Last week, gasoline imports were the lowest for this time of the year since at least 2004.
Gasoline stockpiles in independent storage in Amsterdam- Rotterdam-Antwerp, Europe’s oil-trading hub, dropped to the lowest level in almost a year, according to PJK International BV.
“There’s a lot of heavy maintenance going on in Europe,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. “Basically, we’re at extremely low levels.”
Regular gasoline at the pump fell 1 cent to $3.795 a gallon yesterday, AAA data show. Prices have fallen 12 of the past 13 days, declining 7.6 cents to the lowest since Aug. 27. Prices reached a 2012 high of $3.936 on April 4.
October-delivery heating oil rose 5.21 cents, or 1.7 percent, to $3.1589 a gallon on exchange.
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