Aug. 21 (Bloomberg) -- Gasoline gained the most in a week after a government report showed stockpiles of the motor fuel declined more than forecast.
Futures gained 0.4 percent as the U.S. Energy Information Administration reported that inventories dropped by 4.03 million barrels in the seven days ended Aug. 19, more than the 1.5 million-barrel drop that was the median estimate of 11 analysts in a survey by Bloomberg. Repairs at Motiva Enterprises LLC’s Port Arthur, Texas, refinery, the largest in the U.S., will take two to six weeks after an Aug. 17 fire, according to a person familiar with operations at the plant.
“Four million barrels is a big draw,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. “Gasoline is also getting support from the hydrocracker at Motiva Port Arthur being out for up to six weeks.”
Gasoline for September delivery rose 1.05 cents to settle at $2.9377 a gallon on the New York Mercantile Exchange on trading volume that was 7.7 percent below the 100-day average at 4:23 p.m.
Gasoline supplies on the East Coast, which includes New York Harbor, the delivery point for gasoline and diesel contracts, fell 2.74 million barrels to 58.5 million, the lowest level since March 29. Inventories of reformulated gasoline blendstock for oxygen blending on the East Coast fell by 2.17 million barrels to 16.3 million, a 7-month low.
“The EIA inventory draw was significantly more than the market expected and a big part of the draw was New York Harbor RBOB inventories,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston.
The motor fuel’s crack spread versus West Texas Intermediate crude widened $1.26 to $14.52 a barrel. The fuel’s premium over Brent gained 34 cents to $8.56.
Demand over four weeks was 2 percent above the previous year as the U.S. approaches the Sept. 2 Labor Day holiday, traditionally the end of the summer driving season. Nationwide, supplies are 4.6 percent above the five-year average.
“Gasoline is well supplied but Labor Day is coming up and there could be an end-of-season spike,” said Andrew Lebow, a senior vice president at Jefferies Bache LLC in New York.
Pump prices, averaged nationwide, fell 0.4 cent to $3.533 a gallon, Heathrow, Florida-based AAA said today on its website, the fourth drop in a row.
Distillate inventories, including diesel and heating oil, increased 871,000 barrels, below the estimate of 1 million barrels.
Ultra-low-sulfur diesel for September delivery fell 0.16 cent to $3.0768 a gallon on the Nymex on trading volume that was 22 percent below the 100-day average.
ULSD’s crack spread versus West Texas Intermediate crude rose $1.10 to $25.57 a barrel. The premium over Brent widened 18 cents to $19.61 a barrel.
--Editors: David Marino, Richard Stubbe