Gasoline Futures Advance on U.S. Economic Data, Crude Rally

Gasoline rose as U.S. economic data boosted optimism that fuel demand will increase and reports of 35 hostages killed in Algeria pushed crude oil higher.

Futures gained as much as 1.5 percent as Labor Department data show U.S. applications for jobless benefits fell by 37,000 to 335,000 last week, the least since January 2008. Mauritania’s private ANI news agency reported that 35 hostages and 15 abductors were killed as Algerian security forces stormed a gas complex where an al-Qaeda-linked group held foreign hostages.

“Obviously the market went through a geopolitical upset in North Africa the year before last,” Andrew Lebow, senior vice president at Jefferies Bache LLC in New York, said by phone. “Not that Algeria will turn into Libya, but any unrest in the region is cause for worry.”

Gasoline for February delivery rose 4.23 cents, or 1.6 percent, to $2.7637 a gallon at 12:44 p.m. on the New York Mercantile Exchange. Volume was 2 percent above the 100-day average.

February crude oil futures gained 1.7 percent to $95.80 a barrel on the exchange.

Demand for the motor fuel rose 3.9 percent to 8.32 million barrels a day. Consumption over the past four weeks was down 0.6 percent from the same period a year earlier.

“The demand numbers haven’t been particularly good in the U.S., maybe the they’re hoping that looking forward demand picks up,” Lebow said.

February-delivery heating oil rose 2.28 cents, or 0.8 percent, to $3.0219 a gallon on the Nymex, after climbing as much as 1.2 percent in earlier trading. Volume was 6.3 percent below the 100-day average.

ICE Gasoil

The fuel pared gains as February gasoil fell as much as 0.5 percent on the ICE Futures Europe exchange in London after inventories of gasoil in the Amsterdam-Rotterdam-Antwerp trading hub in Northwest Europe rose for a fifth consecutive week.

Supplies grew 4.1 percent to 2.22 million metric tons in the week through today, according to PJK International BV.

When gasoil prices fall, it lowers demand for U.S. heating oil exports to Europe, said Amrita Sen, chief oil market strategist at Energy Aspects Ltd., a research consulting company in London.

“They do seem to be following each other,” Sen said. “The entire crude complex is pretty strong on geopolitical news. There’s nothing bearish in heating oil news.”

Gasoline at the pump, averaged nationwide, fell 0.2 cent to $3.292 a gallon, AAA said on its website today. It’s the sixth day in a row the price of fuel for drivers has declined.

To contact the reporter on this story: Dan Murtaugh in Houston at dmurtaugh@bloomberg.net

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

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