Gasoline fell as Tropical Storm Ernesto appeared to be less of a threat to U.S. Gulf Coast oil refining and on concern that Europe’s debt crisis is deepening.
Futures retreated as Ernesto was on a path that will probably take it toward landfall on Belize and then Mexico’s Yucatan Peninsula, the National Hurricane Center said. Italy’s Prime Minister Mario Monti warned of a potential breakup of Europe without greater urgency in efforts to lower government borrowing costs.
“The track of the storm appears less threatening and last week’s enthusiasm about the European debt bailout is waning,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago.
Gasoline for September delivery declined 4.01 cents, or 1.4 percent, to $2.8909 a gallon at 9:47 a.m. on the New York Mercantile Exchange.
The fifth storm of the Atlantic hurricane season had winds of 50 miles (80 kilometers) per hour and was moving west in the Caribbean at 12 mph, the Miami-based center said in an advisory at 8 a.m. East Coast time. Ernesto was about 145 miles east of Cabo Gracias a Dios on the Nicaragua-Honduras border.
Monti, in an interview with Germany’s Der Spiegel magazine published yesterday, said that disagreements within the 17- nation euro area are detracting from the policy response to the debt crisis and undermining the future of the European Union.
Heating oil for September delivery fell 0.72 cent, or 0.3 percent, to $2.9189 a gallon.
Regular gasoline at the pump, averaged nationwide, rose 0.9 cent to $3.619 a gallon yesterday, AAA data showed. That’s the highest price since May 30. Prices have fallen 8.1 percent from a 2012 high of $3.936 on April 4, according to AAA, the nation’s largest motoring organization.
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