We are moving into the peak summer season driving season and gasoline demand has been hitting all-time highs. You might think that inventories would be drawing down and that the U.S. would need to import more gasoline and gasoline mixing parts. But not so. U.S. refineries are cranking out the merchandise. Gasoline stocks are up 10% from a 12 months ago5 million barrels (MMbbl) greater than the top of the 5-yr range—and final week gasoline inventories made a contra-seasonal transfer upward, rising by 1.Four MMbbl. Internet exports for the primary quarter had been up nearly 5 instances the same period in 2015. However what does all this imply for refined product markets usually, and gasoline balances in particular? Today, we examine the state of U.S. petroleum product markets.
The upswing in U.S. gasoline demand is nothing new. RBN blogged about it this time last 12 months in King of the Street (Again) and covered points related to delivering gasoline, diesel and jet gasoline to Northeast markets a couple of weeks back in Move It on Over. Within the Power Info Administration’s (EIA) June 2016 Quick-Term Vitality Outlook, gasoline consumption this summer season was projected to average 9.5 MMb/d, a solid 1.9% larger than the summer of 2015, which was a powerful demand season itself. What really stands out, although, is that even with excessive domestic demand for gasoline, web U.S. export volumes remain spectacular. Determine 1 shows EIA web exports of gasoline (exports much less imports of finished motor gasoline and motor gasoline mixing elements) and net exports of distillates (exports less imports of distillate gas oil and kerosene-sort jet gas). The graph on the left is the entire of net gasoline and distillate exports, exhibiting the huge shift of the U.S. from a web importer of about 1.5 MMb/d in 2006 to a net exporter of about 1.2 MMb/d over the past six months. The graph on the right in Figure 1 focuses on the 2012-sixteen timeframe and splits internet exports into gasoline (inexperienced line) and distillates (brown line). Each are still trending greater, however the large news is gasoline, which has moved effectively into the net export class since late 2015 (purple oval).