Sept. 12 (Bloomberg) -- Gasoline climbed as crude advanced before talks between the U.S. and Russia over disposing of Syria’s chemical weapons and as U.S. jobless claims dropped.
Futures rose 1.9 percent. Applications for unemployment insurance fell by 31,000 to 292,000 last week, the fewest since April 2006, Labor Department data show. Secretary of State John Kerry will press for a timeline for Syria to surrender its chemical arsenal, an American official said, as Russia’s leader urged the U.S. to steer clear of a Middle East military clash.
“The headline is we’re under 300,000 jobless claims and that’s huge,” said Carl Larry, president of Oil Outlook & Opinions LLC in Houston. “And the Syria issue has not gone away.”
Gasoline for October delivery rose 5.05 cents to $2.7627 a gallon on the New York Mercantile Exchange, after settling yesterday at the lowest level since Jan. 15. Trading volume was 7.5 percent below the 100-day average at 3:25 p.m.
President Barack Obama has put on hold a request to Congress to approve a limited strike against Syria for its alleged use of sarin nerve gas against its own people. Kerry and Russian Foreign Minister Sergei Lavrov were scheduled to meet at 7:30 p.m. Geneva time for talks slated to run through tomorrow.
Syrian President Bashar al-Assad said publicly for the first time that his government would allow international control of its chemical weapons, Russia’s state Rossiya 24 news channel reported today. He also set conditions that may block any accord, saying the U.S. must stop making threats and stop arming the rebels seeking to oust his regime.
“We went from pricing in war to pricing in peace and now we’re into pricing in the middle,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago.
West Texas Intermediate crude for October delivery rose $1.04, or 1 percent, to settle at $108.60 a barrel on the Nymex.
Gasoline’s crack spread versus WTI widened as European refinery maintenance may reduce imports into New York Harbor, the delivery point for Nymex products. Those repairs will halt 1 million barrels a day of capacity in September and 1.2 million in October, the International Energy Agency projected in a monthly oil market report today.
Gasoline supplies in PADD 1, which includes New York Harbor, fell 1.44 million barrels last week to 56.8 million, according to Energy Information Administration data. PADD 1 gasoline imports dropped 6.5 percent to 388,000 barrels a day.
In the U.S., planned maintenance in the Gulf Coast, Midwest and East Coast will reduce daily capacity by 1.42 million barrels in September, 795,000 barrels in October and 170,000 barrels in November, said Amrita Sen, chief oil market strategist at Energy Aspects Ltd., a research company in London.
“European refineries have cut runs for economic reasons on top of maintenance,” Sen said. “And the U.S. refineries are starting to go into maintenance, and that will reduce product supplies substantially.”
The motor fuel’s crack spread versus West Texas Intermediate crude widened $1.08 to $7.43 a barrel while the fuel’s premium over Brent rose 99 cents to $3.40.
Pump prices, averaged nationwide, fell 0.8 cent to $3.55 a gallon, 30.8 cents below a year ago, Heathrow, Florida-based AAA said today on its website.
Ultra-low-sulfur diesel for October delivery gained 4.46 cents, or 1.5 percent, to $3.1164 a gallon on trading volume that was 4.1 percent below the 100-day average.
ULSD’s crack spread versus WTI widened 83 cents to $22.29 a barrel while the premium over Brent rose 74 cents to $18.26.
--With assistance from David Lerman in Washington, Henry Meyer in Moscow and James G. Neuger in Brussels. Editors: David Marino, Charlotte Porter