US gasoline inventories
The EIA (U.S. Energy Information Administration) reported that US gasoline inventories fell by 2.8 MMbbls (million barrels) to 243.5 MMbbls from March 10–17, 2017. US gasoline inventories hit 259.1 MMbbls for the week ending February 10, 2017—the highest level ever. US gasoline inventories are 6% below their all-time high.
Crude oil (XOP) (UCO) (ERY) and gasoline prices usually move together. The fall in gasoline inventories is bullish for gasoline and crude oil prices. Moves in gasoline and crude oil prices impact oil producers and refiners’ profitability like Tesoro (TSO), Phillips 66 (PSX), Western Refining (WNR), Matador Resources (MTDR), and SM Energy (SM). For more on crude oil prices, read Part 1 of this series.
Gasoline production, imports, and demand
US gasoline production rose by 231,000 bpd (barrels per day) to 9,771,000 bpd from March 10–17, 2017. Production was up 2.4% week-over-week and 1% year-over-year. US gasoline imports fell by 247,000 bpd to 325,000 bpd during the same period. Gasoline demand fell by 54,000 bpd to 9,200,000 bpd.
Impact of gasoline inventories
For the week ending March 17, 2017, US gasoline inventories are at the upper end of the five-year range. Near-record gasoline inventories could pressure gasoline and crude oil prices.
Read What Can Investors Expect in the Crude Oil Market in 2017 and Are Crude Oil Prices on the Verge of Collateral Damage? for more on crude oil prices.
Read Will Crude Oil Prices Test 3 Digits Again? and Russia’s Central Bank: Crude Oil Prices Could Hit $40 per Barrel for more on crude oil price forecasts.
For more industry analysis, visit Market Realist’s Energy and Power page.