Gasoline Futures Heading for Biggest Monthly Gain Since March

Gasoline futures rose amid below-average volume, heading for the biggest monthly gain since July.

Prices are up 4 percent in December. Trading volume was 43 percent below the 100-day average at 10:18 a.m. A French refinery strike and plant upsets in the U.S. reduced supply earlier in the month as demand increased.

“Today is expiration and traders are only taking what they need,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. “Volumes are very very low.”

Gasoline for January delivery gained 0.48 cent to $2.7925 a gallon on the New York Mercantile Exchange. Prices have gained 6 percent in the three months ended today, the biggest fourth-quarter increase since 2010. The motor fuel has retreated 0.7 percent this year.

Total SA’s five refineries in France have returned to operation after a strike that began Dec. 13 and reduced shipments of gasoline to the U.S. from Europe. U.S. gasoline demand in the four weeks ended Dec. 20 was 3.9 percent above a year earlier, Energy Information Administration data show.

January gasoline and ultra low sulfur diesel futures will expire at the close of floor trading today. The more actively traded February gasoline contract climbed 0.24 cent to $2.7893 a gallon.

The motor fuel’s crack spread versus WTI, a rough measure of refining profitability, widened 64 cents to $18.40 a barrel. Gasoline’s premium to London-traded Brent crude rose 62 cents to $6.36 a barrel.

Pump Price

The average U.S. pump price climbed 0.6 cent to $3.318 a gallon, the 12th consecutive increase and the highest level since Oct. 23, according to Heathrow, Florida-based AAA.

ULSD for January delivery rose 0.66 cent to $3.0838 a gallon on volume that was 33 percent below the 100-day average. The futures have climbed 1.2 percent in December and 3.8 percent in the quarter, heading for the largest three-month gain since third quarter of 2012. Diesel is up 1.3 percent for the year. February futures advanced 0.93 cent to $3.0654.

The fuel’s crack spread versus West Texas Intermediate crude widened 93 cents to $30 a barrel. The premium over European benchmark Brent rose 85 cents to $17.93.

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

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

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