Commodities : Petroleum Futures Rally

Surging gasoline prices led a rally in petroleum futures Wednesday on the New York Mercantile Exchange.

The rally was triggered by a weekly report from the American Petroleum Institute that disclosed a decline of 3.5 million barrels in the nation’s gasoline inventories, said Andrew Lebow, a petroleum analyst in New York with Shearson Lehman Bros.

The report said inventories of gasoline fell during the week ended last Friday to 216.7 million barrels, which compared to 254.7 million barrels a year earlier.

Lebow said crude oil was supported by the report’s disclosure that oil refineries ran at 80% of capacity last week and still were unable to keep up with the demand for gasoline.

However, he noted that part of the supply tightness is related to Environmental Protection Agency regulations that take effect July 1 and that require a lower lead content in leaded gasoline.

Wheat and soybeans were lower and corn was slightly higher on the Chicago Board of Trade.

Weather was the dominant factor in the market, analysts said, as growing conditions are improving across the Midwest for the corn and soybean crops. Rain was forecast for the end of the week.