Gasoline rose as reports of refinery unit shutdowns raised concern that supplies would be tight as the summer driving season began.
Futures advanced after Valero Energy Corp. announced maintenance at its 170,000-barrel-a-day McKee plant in Texas. Today is the first day of the four-day U.S. Memorial Day holiday weekend, the traditional kickoff of the summer driving period when demand is expected to increase.
“Nobody wants to be short the weekend,” said Carl Larry, Houston-based president of Oil Outlooks & Opinions LLC. “There’s too many things popping up.”
Gasoline for June delivery rose 1.09 cents, or 0.4 percent, to settle at $2.839 a gallon on the New York Mercantile Exchange after falling to $2.80. Trading volume was 0.5 percent below the 100-day average at 2:59 p.m. Futures fell 2.3 percent this week, the biggest decline since the seven days ended April 5.
“We’re at Memorial Day, seasonally near the peak for demand, and after that, demand will probably moderate,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago.
Gasoline’s crack spread versus West Texas Intermediate widened 42 cents to $24.53 a barrel. July gasoline’s premium over July Brent shrank by 0.06 cent to $15.86.
Gasoline at the pump, averaged nationwide, fell 0.8 cent to $3.651 a gallon, Heathrow, Florida-based AAA, the nation’s largest motoring organization, said today on its website. Prices are 2.5 cents below a year earlier.
Gasoline demand increased 5.4 percent last week while consumption averaged over four weeks was down 3.3 percent from the year before, Energy Information Administration data showed.
ULSD for June delivery dropped 0.31 cent to settle at $2.8569 a gallon. Trading volume was 26 percent below the 100-day average at 3:07 p.m. Futures declined 2.7 percent this week, the largest drop since the week ended April 19.
July ULSD’s crack spread versus WTI crude oil widened 24 cents to $25.97 a barrel. July ULSD’s premium over Brent fell 24 cents to $17.29 a barrel.