Futures slipped further below the 200-day moving average at $2.8886 a gallon, a key technical resistance level. Phillips 66 said yesterday that power was restored to the 247,000-barrel-a-day plant and units were being restarted. Crack spreads narrowed.
“The issues at Sweeny are going to be short-lived,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. “There is plenty of supply as more and more refineries are returning from maintenance here and in Europe.”
Gasoline for June delivery fell 3.93 cents, or 1.4 percent, to settle at $2.821 a gallon on the New York Mercantile Exchange. Trading volume was 15 percent below the 100-day average at 3:17 p.m.
Gasoline may drop below $2.70 a gallon after failing to break above the 200-day moving average last week, according to a technical analysis on May 10 by Michael Smith, president of T&K in Port Saint Lucie, Florida. Futures may slip to $2.6879 a gallon, the intraday low on May 1 and the lowest level of 2013, Smith said.
“I can’t see any reason for a speculator to buy it right now,” Smith said today.
The May 10 Commitments of Traders report showed hedge funds reducing their bullish positions on gasoline. Large speculators cut bullish gasoline wagers 9.6 percent to 33,343 contracts of futures and options in the week through May 7, the lowest level since Oct. 1, 2010, Commodity Futures Trading Commission data show.
Gasoline demand, measured by deliveries to wholesalers, in the week ended May 3 was the lowest seasonally since 1999, according to Energy Information Administration data. East Coast gasoline stocks in that same period were at the highest level for this time of year since 1999.
‘There are demand concerns everywhere,’’ said Amrita Sen, chief oil market strategist at Energy Aspects Ltd., a research company in London.
Ultra-low-sulfur diesel for June delivery fell 1.52 cents to settle at $2.891 a gallon on trading volume that was 10 percent below the 100-day average at 3:24 p.m.
Gasoline at the pump, averaged nationwide, rose 0.3 cent to $3.579 a gallon, AAA said today on its website. That’s the highest level since April 8. Prices are 14.9 cents below a year earlier.
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