US gasoline inventories
The EIA (U.S. Energy Information Administration) reported that US gasoline inventories fell by 3.7 MMbbls (million barrels) to 239.7 MMbbls from March 17–24, 2017. US gasoline inventories hit 259.1 MMbbls for the week ending February 10, 2017—the highest level ever. US gasoline inventories are 8% below their all-time high.
A market survey estimated that US gasoline inventories would have fallen by 1.9 MMbbls from March 17–24, 2017. A larger-than-expected fall in gasoline inventories supported gasoline prices on March 29, 2017. Gasoline prices rose by 2.3% to $1.67 per gallon on March 29, 2017. Gasoline and crude oil (XLE) (ERY) (ERX) prices hit a three-week high on March 29, 2017.
Volatility in gasoline and crude oil prices impact oil producers and refiners’ profitability like Phillips 66 (PSX), Tesoro (TSO), Valero (VLO), Bonanza Creek Energy (BCEI), and Stone Energy (SGY). For more on crude oil and gasoline prices, read Part 1 of this series.
Gasoline production, imports, and demand
US gasoline production rose by 257,000 bpd (barrels per day) to 10,028,000 bpd from March 17–24, 2017. Production rose 2.6% week-over-week and 6.3% year-over-year. US gasoline imports rose by 196,000 bpd to 521,000 bpd during the same period. Gasoline demand rose by 324,000 bpd to 9,524,000 bpd.
Impact of gasoline inventories
For the week ending March 24, 2017, US gasoline inventories are near the upper end of the five-year range. High gasoline inventories could pressure gasoline and crude oil (IEZ) (RYE) prices.
Read What Can Investors Expect in the Crude Oil Market in 2017 and Key for Investors: Buying or Shorting Crude Oil Futures 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.