Oct. 29 (Bloomberg) -- Gasoline fell on speculation that supplies are adequate to meet demand even as unplanned shutdowns reduce production.
Futures declined 0.8 percent after jumping 1.7 percent yesterday amid a spate of refinery outages, including a “significant” reduction in output from Citgo Petroleum Corp’s refinery near Chicago. U.S. gasoline production in the week ended Oct. 18 was the highest seasonally since at least 1982, according to Energy Information Administration data.
“The market today is putting into perspective the refining issues we have,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago.
Gasoline for November delivery fell 2.11 cents to settle at $2.6098 a gallon on the New York Mercantile Exchange. Trading volume was 20 percent below the 100-day average.
Stockpiles of the motor fuel in the week ended Oct. 18 were at the highest seasonal level in three years.
Citgo said yesterday that its Lemont, Illinois, refinery plans to restart the atmospheric section of its crude unit next week at reduced rates. The company said an Oct. 23 fire was limited to the vacuum distillation section of the unit.
“Gasoline led the complex lower today,” said Joe Posillico, senior vice president of energy derivatives at Jefferies Bache LLC in New York. “Citgo’s statement that they may partially restart the CDU eases some concerns.”
The EIA will probably report tomorrow that gasoline supplies fell 200,000 barrels last week, according to the median estimate of 11 analysts in a survey by Bloomberg. Supplies of distillates, including diesel and heating oil, slipped 1 million barrels, the survey shows.
The motor fuel’s crack spread versus WTI narrowed 30 cents to $10.65 a barrel. The fuel traded at a 16-cent discount to Brent, from a 2-cent premium yesterday.
U.S. retail pump prices, averaged nationwide, fell 0.7 cent to $3.278 a gallon, Heathrow, Florida-based AAA said today on its website. Prices are 26.5 cents below a year ago.
Ultra-low-sulfur diesel for November delivery slipped 0.03 cent to $2.9641 a gallon on trading volume that was 23 percent below the 100-day average.
ULSD’s premium over WTI gained 45 cents to $26.27 a barrel. The spread versus Brent rose 57 cents to $15.46.
--Editors: David Marino, Charlotte Porter