Relief at pump unlikely though gas supply rises

A 1.1 million-barrel increase in West Coast gasoline inventories energized the futures markets Thursday, but don't expect it to make much of a dent in record-high pump prices.

The Energy Information Administration (EIA) on Wednesday reported the first increase in gasoline stocks in 13 weeks, more than half of that in West Coast states that have the highest prices in the country.

Unfortunately, it won't be much help to Seattle-area drivers paying an average of $3.448 a gallon for regular unleaded as of Thursday, according to AAA.

The West Coast region, which includes Washington, Oregon, California, Nevada, Arizona, Alaska and Hawaii, uses roughly 1.6 million barrels of gasoline each day, according to EIA figures. So the 1.1 million-barrel increase in inventories works out to the equivalent of less than one day's worth.

"It's not supersignificant," said David Ramberg of Economic Insight, an energy-industry consulting firm in Portland. "It's good that they have a one-day cushion, but that can get drained out pretty quickly."

With the start of summer-driving season weeks away, analysts worry that gasoline supplies won't meet demand. While the government report showed gasoline supplies slightly higher overall, crude inventories built much more than analysts had expected.

But that didn't have an impact on oil futures, which have been tracking gasoline-futures prices closely, analysts say.

"The story is still gasoline," said Tom Kloza, an analyst at the Oil Price Information Service. "The products, particularly gasoline, are driving the market here. It's keeping crude aloft."

Unplanned outages and scheduled maintenance at refineries, sluggish imports and strong demand have plagued gasoline supplies since early February. At least a dozen additional partial shutdowns worldwide also have cut refining capacity.

Kloza said he thinks pump prices are likely to hit a new high over the next couple of days. The nationwide record is $3.057, reached Sept. 5, 2005, soon after Hurricane Katrina. The average Thursday was $3.037, according to AAA.

Seattle Times business reporter Drew DeSilver contributed to this story.

Drew DeSilver: 206-464-3145 or ddesilver@seattletimes.com