Gasoline Falls on Speculation Demand to Drop After Labor Day

Gasoline slipped on speculation demand will drop as the summer driving season ends after the Sept. 2 U.S. Labor Day holiday and as the school year begins.

Futures slid after gaining 1.3 percent last week amid a series of unplanned refinery outages from Canada to Texas. Gasoline also declined on concern that the Federal Reserve will start tapering monetary stimulus in September.

“We’re going into the shoulder season and there’s the possibility of tapering in September,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago. “The expectations of a shortage of supply are diminishing.”

Gasoline for September delivery fell 2.56 cents, or 0.9 percent, to $2.9816 a gallon at 9:50 a.m. on the New York Mercantile Exchange on trading volume that was 36 percent below the 100-day average.

Gasoline, after jumping 11 percent in July, has declined 2.1 percent this month.

The motor fuel’s crack spread versus West Texas Intermediate crude narrowed a third straight day, dropping 56 cents to $13.59 a barrel. The fuel’s premium over Brent declined 56 cents to $8.97.

Pump prices, averaged nationwide, was unchanged a second day at $3.541 a gallon, Heathrow, Florida-based AAA said today on its website. Prices are 20.7 cents below a year earlier.

Ultra-low-sulfur diesel for September delivery fell 0.64 cent to $3.0886 a gallon on trading volume that was 43 percent below the 100-day average. Prices are up 1.5 percent this month.

ULSD’s crack spread versus WTI slipped 4 cents to $23.70 a barrel. The premium over Brent gained 1 cent to $19.13.

To contact the reporters on this story: Barbara Powell in Dallas at bpowell4@bloomberg.net

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

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.