Gasoline futures gained, rebounding from an earlier decline, after a government report showed nationwide inventories slipped last week on lower production.
Futures climbed as much as 0.9 percent after the U.S. Energy Information Administration said inventories of motor gasoline fell to the lowest level since July 5 and refinery processing of crude and other feedstocks retreated for a fourth consecutive week. The crack spread versus West Texas Intermediate widened for a second day, after reaching the lowest level since January 2012 on Aug. 12.
“Production dropped domestically this week and with margins fairly low, it’s going to take a little bit more for production to pick up and get that supply back,” said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston.
Gasoline for September delivery rose 2.41 cents, or 0.8 percent, to $2.9666 a gallon at 12:27 p.m. on the New York Mercantile Exchange, after touching $2.9252 a gallon. Trading volume was 12 percent higher than the 100-day average.
U.S. stockpiles of motor gasoline slipped 1.17 million barrels to 222.4 million barrels in the week ended Aug. 9, the EIA reported today. Refineries processed 15.9 million barrels a day during the same time period, 273,000 barrels fewer than a week earlier, the data showed.
Inputs may have fallen last week after Citgo Petroleum Corp. shut a reformer at its Lake Charles, Louisiana, refinery and Phillips 66 (PSX) carried out planned work in Borger, Texas. The sites can process a combined 586,000 barrels a day, according to data compiled by Bloomberg.
Ultra-low-sulfur diesel for September delivery rose 0.03 cent to $3.0474 a gallon on trading volume that was 38 percent below the 100-day average.
Pump prices, averaged nationwide, fell 0.3 cent to $3.539 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. The average is 16.3 cents below a year earlier.
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