Gasoline gained as a coastal storm that brought snow and flooding to East Coast areas recovering from Hurricane Sandy may delay fuel imports.
Futures rose as the nor’easter pushed a band of snow into the states around New York City, an area with persistent power outages since Sandy’s Oct. 29 landfall near Atlantic City, New Jersey. Four tankers carrying gasoline and four transporting naphtha were scheduled to arrive in New York Harbor over the next few days, according to the U.S. Coast Guard yesterday.
“Supplies in the Northeast are being impacted by the delayed arrival of tankers because of the nor’easter,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. “Inventories remain low for this time of the year.”
Gasoline for December delivery rose 1.84 cents, or 0.7 percent, to settle at $2.6073 a gallon on the New York Mercantile Exchange. Prices have declined 5.6 percent this month following a 17 percent slide in October.
The East Coast, which includes New York Harbor, the delivery point for the Nymex contract, is recovering from disruptions caused by Sandy. The storm shut retail stations, terminals, refineries and pipelines, reducing the ability of drivers to buy fuel.
Inventories of gasoline in the East Coast, or PADD 1, fell 1.25 million barrels last week to 46.6 million, 8.7 percent below a year earlier, Energy Department data showed.
Total U.S. gasoline imports slid 56 percent to 270,000 barrels a day, the least since December 1999. Shipments of gasoline into the East Coast, where most cargoes land, sank 63 percent to 217,000 barrels.
Gasoline fell 4.1 percent yesterday and touched $2.5755 earlier today on concern that President Barack Obama and a divided Congress won’t reach consensus on a budget deal and as European Central Bank President Mario Draghi said the economic outlook is worsening and indicated the ECB is likely to lower its economic forecasts next month.
Euro-area finance ministers may not decide until late November on unlocking 31.5 billion euros ($40.1 billion) of aid for Greece as they await a report on the country’s compliance with the terms of its bailout, a European Union official said. Greece’s parliament voted today to approve a bill on pension, wage and benefit cuts.
“The factors that drove us down yesterday are still there, worries about how the president and Congress will handle the looming budget debate and the ongoing European debt crisis,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut.
Obama, who won re-election on Nov. 6, and Congress must address a looming $607 billion in automatic spending cuts and tax gains known as the fiscal cliff. Democrats retained control of the Senate while Republicans continue to hold a majority in the House of Representatives.
“Congressional support represents a much broader issue for a second Obama term,” said Amrita Sen, chief oil market strategist at Energy Aspects Ltd., a research consultant in London. “Republicans will continue to push proposals relying solely on spending cuts, which would not be acceptable to a second Obama administration and the negotiations could easily drag on to 2013.”
December-delivery heating oil declined 0.67 cent to settle at $2.9554 a gallon on the exchange.
The average nationwide price for regular gasoline rose 0.2 cent to $3.464 a gallon, AAA, the largest U.S. motoring organization, said today on its website. It was the first increase since Oct. 7. The pump price reached a 2012 high of $3.936 on April 4.