Fasten your seatbelts and dig in your wallets; it's headed up,
just in time for those idyllic summer road trips.
BR,mD

COMMODITIES
Gasoline Contracts Spring Up

Shortage Concerns Ahead of Summer Drive Sharp Gains
By MASOOD FARIVAR
April 13, 2007; Page C6

Gasoline stockpiles are racing against time.
Given low inventories and the rising number of refinery outages, fear of a summer supply crunch would seem well-founded and justify futures prices in excess of $2 a gallon. But with Memorial Day, the unofficial start of the summer, almost two months off, analysts say refiners have enough time to rebuild inventories. The wild card, however, will be imports.
Yesterday, the May reformulated-gasoline blendstock futures contract on the New York Mercantile Exchange climbed to an eight-month high on news of trouble at several U.S. refineries before settling at $2.1918, up 3.31 cents. That rise helped boost front-month crude oil, which settled $1.84 higher at $63.85 a barrel.
"It's too early to panic," said Doug MacIntyre, an analyst at the Energy Information Administration, the Department of Energy's statistics and analysis arm. "There is plenty of time to rebuild inventories, but it depends on when imports start increasing again."
Since late January, gasoline futures have soared 60% as stockpiles of gasoline have slumped by more than 27 million barrels, nearly three times their seasonal rate of decline.
With gasoline demand running near a record 9.5 million barrels a day, the drawdowns have stoked fears that refiners won't have enough inventory on hand this summer to meet a supply shortfall in the event of an unexpected outage. But while inventories have never been this low relative to demand, refiners have a proven record of replenishing stocks during this time of year through a combination of imports and production.
Refiners, wholesalers, and terminal operators keep a certain amount of inventory on hand. To give refiners a cushion against a supply snag during the peak driving season of summer, gasoline inventories -- currently at about 200 million barrels and below their historic range -- need to climb to about 210 million barrels by mid-May and to between 213 million and 214 million barrels by the end of the month, Mr. MacIntyre said.
In other commodity markets:
COPPER: Prices on the Comex division of the New York Mercantile Exchange fell as traders took profits after a two-month rally in the metal. Scott Meyers, senior trading analyst with Pioneer Futures, said the overall trend is still up but the rally may have been overdone. "So a correction of a larger magnitude is certainly warranted," he said. Nearby April copper fell 8.25 cents to $3.4930 a pound.
CATTLE: Live cattle futures on the Chicago Mercantile Exchange dropped sharply. The nearby April contract fell 2.57 cents to 97.35 cents a pound, amid selling as its April 30 expiration nears.


http://online.wsj.com/article/SB1176...N=wsjie/6month