Gasoline Futures Slip on Speculation Supplies Ample for Demand
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By Barbara Powell and Aaron Clark
Dec. 7 (Bloomberg) -- Gasoline futures declined to a one- week low on speculation that inventories are ample to meet demand.
Stockpiles of the motor fuel as of Nov. 27 were the highest in eight weeks, according to the Energy Department. Demand was the lowest in four weeks.
“The fundamentals are poor and without any demand in sight,” said James Cordier, portfolio manager at OptionSellers.com in Tampa, Florida.
Gasoline for January delivery fell 3.44 cents, or 1.7 percent, to settle at $1.9406 a gallon on the New York Mercantile Exchange.
The crack spread, or the difference between crude oil and gasoline, based on January contracts, widened about 10 cents to $7.58 a barrel.
Inventories have climbed as overseas refineries ship excess stockpiles to the U.S. Imports in the week ended Nov. 27 jumped to a three-month high.
“We are seeing increases of gasoline not only here in the U.S. but overseas,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. “There is still plenty of inventory.”
Heating oil for January delivery dropped 1.71 cents, or 0.8 percent, to settle at $2.0097 a gallon. The crack spread, based on January contracts, rose about 82 cents to $10.48 a barrel, after touching $10.717, the highest level since Aug. 12.
Regular gasoline at the pump, averaged nationwide, dropped 0.1 cent to $2.632 a gallon, AAA, the nation’s biggest motoring organization, said today on its Web site.
To contact the reporter on this story: Barbara J. Powell in Dallas at bpowell4@bloomberg.net; Aaron Clark in New York at aclark27@bloomberg.net
Last Updated: December 7, 2009 15:43 EST
