Gasoline Follows Crude Lower as Stocks Build; Contango Widens
Gasoline futures fell, following crude lower after an industry report yesterday showed increases in supplies. The March contract’s discount to April widened.
Gasoline for March delivery slipped as much as 0.7 percent. The American Petroleum Institute said yesterday that U.S. inventories of the fuel grew by 1.56 million barrels. Supplies in the central Atlantic Coast region, including New York Harbor, increased 2.28 million barrels. Crude sank 1.2 percent as the API said stockpiles gained 3.63 million barrels.
“The market is off today, I think it’s looking for a build of crude inventories, and motor gasoline could be up as well,” said Andrew Lebow, a senior vice president at Jefferies Bache LLC in New York.
Gasoline futures were down 1.9 cents, or 0.6 percent, to $3.018 a gallon at 9:50 a.m. on the New York Mercantile Exchange.
The March-April spread increased 0.95 cent to 17.67 cents a gallon, the biggest contango since Feb. 29, indicating near-term supplies of fuel are adequate. The March contract represents winter-grade fuel, which is easier to produce, while the April contract is for summer-grade gasoline.
API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the Energy Department for its weekly survey.
The Energy Information Administration report may show supplies of oil increased 2.65 million barrels last week, according to the median of eight responses in a Bloomberg survey of analysts. Gasoline stockpiles gained 900,000 barrels and distillate inventories declined 625,000 barrels in the survey.
Heating oil futures were down 1.34 cents, or 0.4 percent, to $3.1779 a gallon on the Nymex. API said distillate inventories fell 1.45 million barrels last week.
Gasoline at the pump, averaged nationwide, rose 1.3 cents to $3.546 a gallon, AAA said on its website today. Prices gained for the 20th straight day and are 1.9 percent higher than a year ago.
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