Dec. 4 (Bloomberg) -- Ultra low sulfur diesel fell for the first time in six days as U.S. distillate output jumped to a record and supplies rose the most since July.
Stockpiles of distillates, including diesel and heating oil, increased 2.65 million barrels from a five-year low to 113.5 million last week, the most since July 12, according to Energy Information Administration data. Production jumped 1.8 percent to a record 5.11 million barrels a day.
“The record production is putting a damper on concern about tight supply that had been giving the market support,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago.
ULSD for January delivery slipped 0.6 cent to $3.0591 a gallon on the New York Mercantile Exchange. Trading volume was 13 percent below the 100-day average as of 3:53 p.m.
Prices rose eight of the nine previous days, jumping 5.5 percent, as distillate stockpiles sank. A Bloomberg survey projected a drop of 1.5 million barrels last week.
“Distillate stocks are up and distillate output is at a record high,” said Amrita Sen, chief oil market strategist at Energy Aspects Ltd., a research company in London.
ULSD’s premium over WTI sank $1.41 to $31.28 a barrel. The crack spread versus Brent rose 49 cents to $16.60.
Gasoline for January delivery fell 0.45 cent to settle at $2.7192 a gallon. Trading volume was 32 percent above the 100- day average.
Total U.S. gasoline supplies rose 1.83 million barrels to 212.4 million last week. The survey projected that stockpiles gained 1.25 million barrels.
Supplies in the Central Atlantic area of the U.S. East Coast, or PADD 1 region, increased 1.02 million barrels to 26 million, after dropping to an 11-month low the prior week.
Gasoline’s crack spread versus West Texas Intermediate, a rough measure of refining profitability, narrowed $1.35 to $17.01 a barrel. The fuel’s premium to European benchmark Brent rose 55 cents to $2.33 a barrel.
The average U.S. pump price fell 0.6 cent to $3.257 a gallon, the seventh consecutive decline, Heathrow, Florida-based AAA said today.
--Editors: David Marino, Richard Stubbe