WASHINGTON - Gasoline declined for the first time in three days on speculation that inventories are ample to meet consumption during the U.S. summer driving season.
Futures fell as stockpiles as of May 4 were 0.6 percent higher than a year earlier and demand over the past four weeks was 3.2 percent lower than in 2011, according to Energy Department data. The May 28 Memorial Day holiday is the traditional start of the summer driving season. Futures rose earlier after U.S. jobless claims slipped last week.
“The jobs report gave us a bit of a bounce, but we know the market is oversupplied,” said Phil Flynn, vice president of research at PFGBest in Chicago.
Gasoline for June delivery fell 1.84 cents, or 0.6 percent, to $3.0057 a gallon at 11:37 a.m. on the New York Mercantile Exchange, after touching $3.0249.
First-time claims for jobless benefits declined to a one- month low of 367,000 last week, the Labor Department said today. The number of people on unemployment benefit rolls was the smallest since July 2008.
Gasoline stockpiles fell 2.61 million barrels to 207.1 million in the week ended May 4, according to department data. Inventories, which have dropped 11 percent in 12 weeks to the lowest level since November, are above a year ago when they totaled 205.8 million barrels.
Refiners raised gasoline output to 9.09 million barrels a day, the highest level since Dec. 23.
“The market is more than adequately supplied and the geopolitical risk is the lowest it’s been in months,” said Dominick Chirichella, senior partner at the Energy Management Institute in New York.
Future deepened losses as the dollar strengthened, making commodities less attractive to investors, and equities retreated from their highs of the day.
The dollar was down 0.2 percent against the euro at 11:23 a.m. in New York, after earlier losing 0.4 percent. The Standard & Poor’s 500 Index was up 0.4 percent, after an earlier gain of 0.8 percent.
“The macro sentiment seems to have shifted,” said Addison Armstrong, director of market research at Tradition Energy in Stamford, Connecticut. “The dollar is moving up and the S&P is coming off.”
June-delivery heating oil sank 0.95 cent, or 0.3 percent, to $2.9896 a gallon on the exchange.
Regular gasoline at the pump, averaged nationwide, fell 1.1 cents to $3.739 a gallon Wednesday, according to AAA. That’s the lowest average since Feb. 29. Prices are down 19.7 cents since reaching a 2012 high of $3.936 on April 4. Gasoline peaked in 2011 at $3.985 on May 4.