Gasoline and ultra-low sulfur diesel followed crude higher amid concern that President Barack Obama’s decision to arm Syrian rebels will escalate tensions in the region and disrupt oil supplies. Crack spreads were mixed.
Futures increased weekly gains after reports the U.S. will provide small arms and ammunition to the Syrian opposition and that it confirmed that President Bashar al-Assad’s forces used chemical weapons. Voting in Iran’s election to replace President Mahmoud Ahmadinejad began today.
“This is all on the back of the Obama administration announcing they will begin to arm the Syrian rebels and fears in the market this will ultimately lead to a wider conflict throughout the region,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston.
Gasoline for July delivery rose 4.62 cents, or 1.6 percent, to $2.9075 a gallon at 9:33 a.m. on the New York Mercantile Exchange. Trading volume was 29 percent above the 100-day average for the time of day. Futures are up 1.1 percent this week.
July gasoline’s crack spread versus West Texas Intermediate widened 58 cents to $24.07 a barrel. Gasoline’s premium over Brent gained 9 cents to $16.02.
Gasoline at the pump, averaged nationwide, fell 0.7 cent to $3.625 a gallon, Heathrow, Florida-based AAA said today on its website. Prices are 9.3 cents above a year earlier.
Ultra-low-sulfur diesel for July delivery rose 3.39 cents, or 1.2 percent, to $2.9734 a gallon on trading volume that was 12 percent above the 100-day average. Prices are up 2.8 percent this week.
The July ULSD contract’s crack spread versus WTI narrowed 25 cents to $26.52 a barrel. The premium over Brent fell 61 cents to $18.59.
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