Dec. 6 (Bloomberg) -- Gasoline rose for the first time in three days after the U.S. jobless rate fell to a five-year low, signaling a boost in demand for the motor fuel.
Prices reached a two-week high as the U.S. unemployment rate dropped to 7 percent in November, the lowest since November 2008, Labor Department figures showed today in Washington. The median forecast of analysts in a Bloomberg survey was for a slide to 7.2 percent.
Stronger employment “is moving the gasoline market and crack spreads up today,” said Tom Finlon, director of Energy Analytics Group Ltd., who is based in Jupiter, Florida. “The market’s clear first impression is that less unemployment leads to more demand.”
Gasoline futures for January delivery rose 1.42 cents, or 0.5 percent, to $2.7269 a gallon on the New York Mercantile Exchange, the highest settlement since Nov. 21. Futures advanced 1.6 percent this week. Trading volume was 8.7 percent below the 100-day average as of 3:45 p.m.
Employers added 203,000 people to payrolls last month, compared with the median estimate in a Bloomberg survey for an advance of 185,000. The pickup in employment, combined with faster wage gains and more hours, provides workers with the means to spend.
U.S. consumption of gasoline over the past four weeks averaged 8.94 million barrels a day, up 3.3 percent from a year ago, U.S. Energy Information Administration data show. Supplies climbed to 212.4 million barrels, a five-week high, according to the EIA, the statistical arm of the Energy Department.
Valero Energy Corp.’s 310,000-barrel-a-day Port Arthur, Texas, refinery had a unit upset when a compressor tripped offline yesterday, according to a filing with the Texas Commission on Environmental Quality.
The fuel’s crack spread versus West Texas Intermediate, a rough measure of refining profitability, rose 33 cents to $16.88 a barrel, the first advance in six days, according to data compiled by Bloomberg. The premium to European benchmark Brent slumped 3 cents to $2.92, reversing an earlier gain.
The WTI-Brent spread widened for the first time in four days, adding 36 cents to $13.96 a barrel.
“Cracks are recovering because product markets have been correlating more off of Brent than WTI and when Brent-WTI expands like it has today, the cracks strengthen,” Jim Ritterbusch, president of Ritterbusch & Associates, said by phone from Galena, Illinois.
Ultra low sulfur diesel rose 0.69 cent to $3.0565 a gallon on volume that was 17 percent below the 100-day average. Prices climbed 0.3 percent this week.
A government report showed U.S. distillate production surged to a record high of 5.11 million barrels a day last week. Stockpiles grew by 2.6 million barrels to 113.5 million, the first rise in six weeks, according to EIA data.
ULSD’s premium over WTI climbed 2 cents to $30.72 a gallon. The crack spread versus Brent dropped 34 cents to $16.76 a barrel.
--Editors: David Marino, Richard Stubbe