Gasoline Inventories Fall; Demand Rises

U.S. gasoline inventories fell for a third straight week, as demand rose to its highest level since reaching a 22-year high in June and refineries slowed production, an industry report showed.

Supplies fell 1.4% to 212.3 million barrels, the American Petroleum Institute said. The decline, about triple the size expected by analysts, left inventories 2.3% higher than a year earlier.

Demand for gasoline rose 0.3% to 9.44 million barrels a day, and production was down 2.7%. Demand reached 10.1 million barrels a day during the week ended June 29, the highest level since at least January 1979.

“You’ve got production down, demand strong, stocks declining and the surplus shrinking,” said Tim Evans, energy analyst at IFR Pegasus in New York. “That should all translate to prices rising.”