Sept. 28 (Bloomberg) -- U.S. gasoline inventories probably rose to the highest level in six months as demand slipped with the end of the summer driving season and economic growth slowed, a Bloomberg News survey showed.
Stockpiles climbed 350,000 barrels, or 0.2 percent, in the seven days ended Sept. 24 from 226.1 million a week earlier, according to the median of 14 analyst estimates before an Energy Department report tomorrow. The gain would leave supplies at the highest level since March 12.
An increase in first-time claims for jobless benefits in mid-September points to reduced gasoline demand and lower pump prices. Consumption dropped 1.9 percent in the week ended Sept. 17, the smallest level since February. Regular gasoline, averaged nationwide, declined for an 11th straight day to $2.691 a gallon on Sept. 26, the AAA said on its website.
“We’ve seen a recent major decline in gasoline demand,” said Peter Beutel, president of trading advisory company Cameron Hanover Inc. in New Canaan, Connecticut. “Normally demand drops at this time of year along with refinery utilization rates. We’ve yet to see refiners cut back.”
Gasoline output has outpaced demand during the past three weeks, according to the department. Refineries produced 9.02 million barrels a day of gasoline compared with demand of 8.85 million.
Supplies of the fuel in the week ended Sept. 17 were 15 percent higher than the five-year average for the period, the department said.
Gasoline for October delivery increased 1.26 cents, or 0.7 percent, to $1.9614 a gallon at 10:40 a.m. on the New York Mercantile Exchange. Crude for November delivery declined 12 cents to $76.40 a barrel.
Jobless Claims
The Labor Department reported on Sept. 23 that U.S. jobless claims unexpectedly rose by 12,000 to 465,000 in the week ended Sept. 18, as the unemployment rate holds near a 26-year high.
New York University Professor Nouriel Roubini said there’s a high probability of another recession in the U.S. Second- quarter gross domestic product figures for the U.S. are likely to be revised lower after “awful” June real-estate numbers, Roubini said at a conference in Kuala Lumpur yesterday.
U.S. fuel demand will drop 9 percent to average 18.93 million barrels a day this year, from a record 20.8 million in 2005, the Energy Department said on Sept. 8.
Refineries probably operated at 87.2 percent of capacity, down 0.6 percentage point from the previous week, according to the Bloomberg survey. Operating rates unexpectedly increased 0.2 percentage point in the week ended Sept. 17
Gasoline Imports
Imports of gasoline jumped 32 percent to 850,000 barrels a day in the week ended Sept. 17, according to the department. Crude oil imports increased 3.3 percent to 9.32 million barrels a day.
“We can expect a build in gasoline because demand has been very weak,” said Phil Flynn, vice president of research at PFGBest in Chicago. “Refineries have been running at higher levels than expected. They are probably planning to export the excess gasoline and distillate fuel.”
Total fuel exports averaged a record 2.16 million barrels a day for a second straight week in the seven days ended Sept. 17, according to the department.
Stockpiles of distillate fuel, a category that includes heating oil and diesel, probably climbed 325,000 barrels, or 0.2 percent, from 174.9 million, the survey showed. Inventories in the week ended Aug. 20 were the most since 1983.
Falling Demand
Total fuel consumption slipped 1.8 percent to 19.2 million barrels a day in the week ended Sept. 17, the lowest level since July.
Crude-oil stockpiles probably declined 700,000 barrels, or 0.2 percent, from 358.3 million, according to the survey. Inventories in the week ended Sept. 17 were 13 percent higher than the five-year average for the period, the department said.
U.S. stockpiles of oil and fuel climbed 3.3 million barrels to 1.14 billion in the week ended Sept. 17, the highest level since at least 1990, when the Energy Department began to collect weekly data. Inventories have climbed for fourteen of the past fifteen weeks. On a monthly basis, supplies are at the highest level since January 1983.
The department is scheduled to release its weekly report at 10:30 a.m. tomorrow in Washington.
--Editors: Joe Link, Bill Banker
To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.net
To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net.
