US Cash Products-Group Three mogas drops despite low supply

TORONTO, May 29 (Reuters) - Prompt gasoline cash prices in the Midwest's Group Three market fell despite low inventories as trade looked to June barrels which become prompt Monday, traders said on Friday.

Inventories along the Magellan system are at historical lows, with days of supply at 15.8 compared with the 21 days of supply in 2008 and about 18 days in the two previous years, according to trade sources.

"You usually get this type of low inventory toward the end of summer, but to get it in May going into June is unprecedented," said one Midwest broker.

Barrels from the middle of the Midwest's Group Three market were seen being pulled into Chicago where turnaround work continues on a gasoline-making FCCU at BP's Whiting, Indiana refinery.

"We have experienced a few short-term outages of N-grade at some terminals located in the central portion of our pipeline system," Magellan spokesman Bruce Heine said, with outages ranging from a few hours to a few days.

Chicago prices spiked to as high as 30 cents over the futures benchmark late Thursday on supply shortages, making it economically attractive to move barrels from one Midwestern hub to another.

On Friday, crude oil future prices rose on a falling dollar, political tension in North Korea, and market sentiment that OPEC is able to control the downside of the crude oil price. [O/N]

For a complete list of refinery outages, click [REF/US]

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