Dec. 20 (Bloomberg) -- Gasoline jumped to a three-month high as the U.S. economy expanded at a faster rate than previously estimated, indicating fuel demand may increase.
Futures rose 5.8 percent this week, the largest gain since July. Gross domestic product climbed at a 4.1 percent annualized rate in the third quarter, the strongest since the final three months of 2011 and up from a previous estimate of 3.6 percent, Commerce Department figures showed today.
“The GDP was stronger and generally that’s indicative of a stronger economy which, all things being equal, leads to a pickup in petroleum products demand,” said Andrew Lebow, a senior vice president at Jefferies Bache LLC in New York.
Gasoline for January delivery rose 4.3 cents, or 1.6 percent, to $2.7831 a gallon on the New York Mercantile Exchange, the highest settlement since Sept. 9. Trading volume was 14 percent above the 100-day average as of 3:24 p.m.
Gasoline was the second-best performer this week on the Standard & Poor’s GSCI commodity index, trailing only lean hogs. Futures have climbed every day this week in the longest rally since June 7 and are up 3.7 percent this month.
Gasoline stocks in PADD 1, which includes New York Harbor, the delivery point for futures contracts, fell 1.4 percent and imports slipped 15 percent last week, according to Energy Information Administration data. U.S. gasoline demand climbed 8 percent last week and over the past four weeks was up 3.7 percent from a year ago. Total petroleum demand jumped 13 percent to the highest level since 2008.
“The expectations on demand have been very poor,” said Amrita Sen, chief oil market strategist at Energy Aspects Ltd., a research company in London. “The EIA indicates demand may be robust. The GDP reaffirmed the health of the U.S. economy going into 2014 is robust and we should be able to see better demand numbers from the U.S.”
Gasoline and ultra-low diesel also rose as a French refinery strike has idled four of Total SA’s five plants in that country. The strike over workers’ pay, which freezes about 700,000 barrels a day of crude processing capacity, entered its eighth day today.
“The French strike is resulting in less gasoline available for export from Europe while increasing the diesel import demand,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston.
The motor fuel’s crack spread versus West Texas Intermediate, a rough measure of refining profitability, widened $1.31 to $17.64 a barrel. Gasoline’s premium to Brent increased 11 cents to $5.19.
The average U.S. pump price rose 1 cent to $3.222 a gallon, the first increase in 12 days, according to data from Heathrow, Florida-based AAA.
Supplies of distillates, including diesel and heating oil, fell 2.11 million barrels to 116 million. PADD 1 distillate supplies declined 1.24 million barrels to 36.5 million. Demand jumped 785,000 barrels to 4.09 million a day.
ULSD for January delivery gained 4.75 cents, or 1.6 percent, to $3.0781 a gallon, the highest settlement since Sept. 13. Trading volume was 15 percent above the 100-day average. Futures climbed 3.4 percent this week.
ULSD’s crack spread versus WTI widened $1.61 to $29.63 a barrel. The premium over Brent rose 41 cents to $17.18.
--With assistance from Victoria Stilwell in Washington and Konstantin Rozhnov and Morgane Lapeyre in London. Editors: David Marino, Margot Habiby