Gasoline jumped to a three-month high as Federal Reserve Chairman Ben S. Bernanke called for continuing monetary stimulus.
Futures rose a day after Bernanke said that “highly accommodative monetary policy for the foreseeable future is what’s needed in the U.S. economy.” A Labor Department report today showing jobless claims increased to a two-month high indicated that the Fed may not soon reduce its $85 billion in monthly bond purchases. Gasoline jumped above $3 a gallon for the first time since April yesterday after a report that inventories dropped the most in 11 weeks and demand reached the highest level since August.
“Bernanke’s statement that they’re not going to pull back seems to have fostered another leg on the rally,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. “But the market is overdone.”
August-delivery gasoline rose 1.48 cents, or 0.5 percent, to $3.0297 a gallon at 10 a.m. on the New York Mercantile Exchange on trading volume that was 62 percent above the 100-day average for the time of day.
The Energy Information Administration reported yesterday that gasoline supplies fell 2.63 million barrels to 221 million, the fewest since May 31 and the biggest drop since April 19. Demand increased for a fourth straight week to 9.3 million barrels a day, the most since Aug. 10.
Pump prices, averaged nationwide, rose 1.7 cents to $3.518 a gallon, Heathrow, Florida-based AAA said today on its website. That’s the highest price since June 26.
Ultra-low-sulfur diesel, or ULSD, for August delivery gained 0.96 cent to $3.0113 a gallon on volume that was 27 percent below the 100-day average.
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