23 June 2011 23:57 [Source: ICIS news]
HOUSTON (ICIS)--Gasoline prices in the US dropped to their lowest levels since mid-March, pushed down by sinking crude oil futures and data that suggests a weak economy.
The NYMEX front-month futures price for reformulated gasoline blendstock for oxygenated blending (RBOB) fell by 4.6% from a day ago, matching the 4.6% fall in crude oil futures.
The July RBOB settlement on Thursday ended at $2.8376/gal, down by 13.57 cents/gal from Wednesday. The settlement was the lowest since15 March, when it settled at $2.8029/gal.
The biggest reason for the fall was the announcement from the International Energy Administration (IEA) that its members would release 60m bbl of crude oil from their strategic reserves, with half that amount to be supplied by the US.
Often, spot gasoline differentials - the difference between the gasoline futures price and various grades of spot gasoline - will move in such a way to soften the effect of the futures price movement. However, that did not happen on Thursday as differentials moved a much smaller amount than the futures price for gasoline.
This lead to a larger-than-typical decline of various spot gasoline prices in the US Gulf (USG) and New York Harbor (NYH) regions. Prices fell by 11.25-16.50 cents/gal.
USG premium and regular gasoline spot prices fell the most, dropping by 16.50 cents to settle at $2.9150-2.9175/gal and $2.7150-2.7175/gal, respectively. NYH regular gasoline experienced the smallest fall, dropping by 11.25 cents to $2.6950-2.6975/gal.
Adding to the weakness in gasoline was economic data that showed a larger-than-expected build in US jobless claims and a month-on-month fall of 5.8% in retail gasoline prices.
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