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Gasoline Futures Gain as Brent Crude Rallies on Tighter Supply

Aug. 13 (Bloomberg) -- Gasoline jumped to a one-week high as Brent crude rose, increasing processing costs for New York Harbor and Gulf Coast refiners using imported oil.

Futures advanced 1.3 percent. Brent for September settlement on the London-based ICE Futures Europe exchange gained 85 cents to $109.82 a barrel, a four-month high, on concern disruptions in Libya and Sudan may limit supply. Refiners on the East Coast and some on the Gulf Coast process crude from overseas that is priced off the London benchmark. Crack spreads widened.

“Products are being drawn up by Brent and Brent is being supported by supply disruptions in Iraq, Libya and Sudan,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston.

Gasoline for September delivery rose 3.84 cents to $2.9425 a gallon on the New York Mercantile Exchange, the highest settlement price since Aug. 5. Trading volume was 22 percent below the 100-day average at 3:11 p.m.

The motor fuel’s crack spread versus West Texas Intermediate crude increased 89 cents to $16.76 a barrel. Gasoline’s premium over Brent widened 76 cents to $13.77.

Pump prices, averaged nationwide, fell 0.7 cent to $3.542 a gallon, Heathrow, Florida-based AAA said today on its website. Prices have fallen every day this month and are the lowest since July 10.

ULSD Rises

Ultra-low-sulfur diesel gained on estimates by analysts at Petromatrix and JBC Energy that European refiners will cut production amid declining margins and because of seasonal maintenance.

“Products are getting a bit of support from talks of run cuts,” said Amrita Sen, chief oil market strategist at Energy Aspects Ltd., a research company in London. “There’s lots of maintenance coming up.”

Ultra-low-sulfur diesel for September delivery rose 2.62 cents, or 0.9 percent, to $3.0471 a gallon on trading volume that was 11 percent below the 100-day average.

ULSD’s crack spread versus West Texas Intermediate crude widened 38 cents to $21.15 a barrel. The premium over Brent gained 25 cents to $18.16.

To contact the reporter 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

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