The 31 cent increase in crude to $77.83 solidified an 8.5% ascent the past week. Technical analysts are now talking about $85 crude. Gasoline rose 19.8 cents or 11.2% in the same time frame. The draw on gasoline inventory last week has energized the market for gasoline and driven crude and products up. Despite this being the middle of October distillate almost seems in slow motion and moving in tandem with crude rather than being the prime mover of the market the way it normally is at this season. The draw on distillate inventory was so much smaller than gasoline's that inventory levels are still higher than the average of the last 25. The market may be misreading fundamentals because demand remains weak and only supply has been cut.
Listening to Los Angeles radio announce the average gas price in America's second largest city is at $3.02 made me appreciate the best local price at $2.26. What a disparity between the Gulf and the West Coast.
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