Chicago Gasoline Slumps as Demand Wanes at End of Summer
Conventional, 85-octane gasoline, or CBOB, slid 7 cents to 3 cents a gallon above futures on the New York Mercantile Exchange at 12:48 p.m., the lowest level since Aug. 23. A delivery cycle change this week helped pull the differential lower over the past three days.
“The barrel into the new cycle is just a lot weaker,” Jim Mosby, supply manager of ADMO Energy LLC, said by phone from Kansas City, Missouri. “People don’t want to buy it.”
Nationwide demand for gasoline rose 0.7 percent to 9.1 million barrels in the week ended Aug. 30 after dipping to a five-week low a week earlier, according to Energy Information Administration data. Consumption typically tapers off after the Labor Day holiday weekend in early September when summer vacations end and students return to school.
Stockpiles of gasoline in the U.S. Midwest, known as PADD 2, fell 997,000 barrels to 46.8 million last week, the lowest since Nov. 23, EIA data showed. Distillate inventories rose 511,000 barrels to 30.3 million.
Ultra-low-sulfur diesel fuel in Chicago climbed 0.5 cent to a discount of 1 cent against ULSD futures.
The 3-2-1 crack spread in the region, a rough measure of refining margins for gasoline and diesel based on West Texas Intermediate oil in Cushing, Oklahoma, added 7 cents to $14.56 a barrel, the first gain in four days, according to data compiled by Bloomberg.
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