Heating Oil Advances Most Since November on Technical Bounce

Heating oil rose the most since Nov. 19, rebounding from a 12-week low as it jumped from technical support levels.

Futures gained 1.9 percent. Heating oil climbed above the lower Bollinger Band for the first time since Feb. 25, signaling chart support where buy orders may be clustered. This indicator is around $2.9316 a gallon today. The crack spread versus Brent crude widened for the first time in nine days.

“We had been oversold,” said Mark Anderle, a trader at Truman Arnold Cos. in Dallas. “We got below the lower Bollinger band. We bounced off support. It could be a temporary bounce to cure an oversold position.”

Heating oil for March delivery gained 5.39 cents to settle at $2.973 a gallon on the New York Mercantile Exchange. The spread versus Brent oil on ICE Futures Europe exchange in London widened 75 cents to $13.26 a barrel.

Futures traded below the 200-day moving average of $2.9876 for the fifth consecutive day.

“The key test is if we get back above the 200-day,” Anderle said. “If not, this looks like just a reaction to an oversold condition.”

Heating oil and gasoline widened gains as part of a broad commodities rally after the Dow Jones Industrial Average touched a record 14,286.37. Heating oil, followed by gasoline, were the top performers today on the Standard & Poor’s GSCI index of 24 materials, which gained 0.6 percent at 2:35 p.m. in New York.

New Highs

The market “got to new highs on the Dow,” said Michael Truscelli, a broker at Paramount Options Inc. in New York.

Gasoline advanced on speculation that seasonal maintenance may have limited production and reduced supplies last week.

“We’ve got a lot of maintenance coming up and I think refinery utilization will be down a little bit,” said Dominick Chirichella, senior partner at the Energy Management Institute in New York.

U.S. gasoline stockpiles probably fell 1 million barrels last week, according to the median estimate of 12 analysts in a survey by Bloomberg. Supplies of distillates, including diesel and heating oil, probably also declined 1 million barrels, the survey showed. The Energy Department is scheduled to report last week’s inventories at 10:30 a.m. tomorrow in Washington.

April-delivery gasoline advanced 4.99 cents, or 1.6 percent, to settle at $3.1482 a gallon, the highest settlement since Sept. 28. The April crack spread, or premium for gasoline over West Texas Intermediate crude, widened $1.39 to $41.40 a barrel. The spread versus Brent increased 57 cents to $20.61.

Gasoline at the pump, averaged nationwide, fell 0.9 cent to $3.737 a gallon, AAA said today on its website. It was the sixth consecutive drop. Prices, which have risen 14 percent this year, are 3 cents below a year earlier. Prices in 2012 peaked on April 4 at $3.936 after rising every day but one from March 9.

“Gas prices have increased for the month of March for nine years in a row, so it is still too early to say whether or not we have peaked,” Michael Green, a spokesman for AAA in Washington, said in an interview. “There is still refinery maintenance to be completed and much of the country must transition to summer-grade gasoline, which costs more to produce.”

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