Gasoline Futures Gain as Brent Crude Rallies on Tighter Supply

Gasoline jumped to a one-week high as Brent crude rose, increasing processing costs for New York Harbor and Gulf Coast refiners using imported oil.

Futures advanced as much as 1.2 percent. Brent for September settlement on the ICE Futures Europe exchange gained as much as 99 cents to $109.96 a barrel. Refiners on the East Coast and some on the Gulf Coast process crude from overseas that is priced off the London benchmark. Crack spreads widened.

“Products are being drawn up by Brent and Brent is being supported by supply disruptions in Iraq, Libya and Sudan,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston.

Gasoline for September delivery rose 2.25 cents, or 0.8 percent, to $2.9266 a gallon at 10:23 a.m. on the New York Mercantile Exchange, after touching $2.9384, the highest intraday price since Aug. 6. Trading volume was 30 percent below the 100-day average.

The motor fuel’s crack spread versus West Texas Intermediate crude rose $1.29 to $17.15 a barrel, the biggest gain this month. Gasoline’s premium over Brent widened 57 cents to $13.57.

Pump prices, averaged nationwide, fell 0.7 cent to $3.542 a gallon, Heathrow, Florida-based AAA said today on its website. Prices have fallen every day this month and are the lowest since July 10.

ULSD Rises

Ultra-low-sulfur diesel gained amid estimates by analysts at Petromatrix and JBC Energy that European refiners will cut production amid declining margins and because of seasonal maintenance.

“Products are getting a bit of support from talks of run cuts,” said Amrita Sen, chief oil market strategist at Energy Aspects Ltd., a research company in London. “There’s lots of maintenance coming up.”

Ultra-low-sulfur diesel for September delivery rose 1.37 cents, or 0.6 percent, to $3.0385 a gallon on trading volume that was 16 percent below the 100-day average.

ULSD’s crack spread versus West Texas Intermediate crude widened $1.17 to $21.94 a barrel. The premium over Brent rose 50 cents to $18.41.

To contact the reporter on this story: Barbara Powell in Dallas at bpowell4@bloomberg.net; Mario Parker in Chicago at mparker22@bloomberg.net

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

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