19 Dec

US Gasoline’s Demand Trend Is Changing

WRITTEN BY Gordon Kristopher

US gasoline demand

The EIA estimates that four-week average US gasoline demand fell by 21,000 bpd (barrels per day) to 9.1 MMbpd (million barrels per day) on December 1–8, 2017. However, demand rose 1.6% or by 142,000 bpd YoY (year-over-year).

The YoY increase in gasoline demand will benefit gasoline and crude oil (USL) (SCO) prices. Higher gasoline (UGA) prices have a positive impact on US refiners (CRAK) like Phillips 66 (PSX) and Valero (VLO).

US Gasoline’s Demand Trend Is Changing

US gasoline demand peaks and lows 

The above chart shows the relationship between gasoline demand and gasoline prices. US gasoline demand hit 8.2 MMbpd in January 2017. It was the lowest level since February 2012. US gasoline demand hit 9.8 MMbpd in August 2016—the highest level ever.

US gasoline consumption estimates 

On December 12, 2017, the EIA released its STEO (Short-Term Energy Outlook) report. It estimates that US gasoline consumption will average 9.34 MMbpd in 2018. It would be the highest level ever. Higher demand would be positive for oil prices. Higher oil (UWT) prices have a positive impact on oil producers (XES) (PXI) like Stone Energy (SGY) and Northern Oil & Gas (NOG).

US gasoline consumption could average 9.32 MMbpd in 2017. Consumption averaged 9.32 MMbpd in 2016—a record high.

Impact

US gasoline consumption could hit a record in 2018. Record gasoline demand is bullish for gasoline and even crude oil (UWT) (DBO) prices. However, improving fuel efficiency could have a marginal impact on gasoline consumption.

Next, we’ll discuss some crude oil price forecasts.

Latest articles

Investors have been holding their breath for a Fed rate cut for a while now. But are they prepared in the event that that doesn't happen?

Innovative Industrial Properties (IIPR) continued to slump on July 22. The stock lost almost 6.8% of its value on the day.

22 Jul

Why AT&T Stock Is Down 2.2% Today

WRITTEN BY Ambrish Shah

AT&T stock (T) was trading at $32.14 with a 2.0% loss for the day. Earlier today, it posted a low of $32.08. Is the stock overvalued right now?

The Walt Disney Company’s (DIS) superhero film Avengers: Endgame has finally surpassed the record set by James Cameron’s Avatar.

22 Jul

Why Durect Corporation Is Soaring Today

WRITTEN BY Margaret Patrick

On July 22, Durect Corporation (DRRX) entered into a collaboration with HIV leader Gilead Sciences (GILD).

Pure Alpha, the flagship fund of Ray Dalio’s Bridgewater Associates, fell 4.9% in the first half, the Financial Times reported.