February 26th, 2013

Gasoline futures in New York tumbled the most since November as Brent crude and refined products in Europe declined. Crack spreads narrowed.

March futures fell as much as 3.1 percent. The April crack spread, or premium of gasoline over West Texas Intermediate crude on Nymex, declined $1.48 to $42.48 a barrel. The spread versus Brent crude on the ICE Futures Europe exchange in London shrank $1.05 to $21.58 a barrel. Brent slipped as Italy’s borrowing costs rose to a three-month high on concern political stalemate will worsen the country’s debt crisis.

“People are realizing the spike we saw in gasoline may be unjustified,” said Phil Flynn, senior market analyst at Price Futures Group in Chicago. “We’re seeing the European fear play come back into the market.”

Gasoline futures for March delivery fell 6.91 cents, or 2.3 percent, to $2.992 a gallon at 9:54 a.m. on the New York Mercantile Exchange on volume that was 78 percent above the 100- day average. Prices have dropped five of the past six days after reaching a four-month high on Feb. 15.

The March contract, which expires Feb. 28 and is for winter-grade fuel, widened its discount to April futures by 2.81 cents to 23.06 cents. The April contract represents summer-grade gasoline, which is more expensive to refine. April’s premium over September futures shrank 1.5 cents to 26.72 cents a gallon.

Gasoline has gained 6.4 percent this year and is the second-best performer after cotton this year on the Standard & Poor’s GSCI index of 24 commodities. Prices have risen on concern refinery shutdowns will tighten supply as demand picks up in April.

Retail gasoline, averaged nationwide, rose 0.5 cent to $3.782 a gallon, the highest level since Oct. 14, AAA said today on its website. The fuel has jumped 15 percent this year to within 15.4 cents of last year’s high of $3.936, according to AAA data.

Heating oil for March delivery fell 3.32 cents, or 1.1 percent, to $3.0657 a gallon on the exchange. Volume was 30 percent above the 100-day average.

- Barbara Powell in Dallas at Bloomberg.