US gasoline demand
The four-week average US gasoline demand rose by 190,000 bpd (barrels per day) to 9,224,000 bpd on December 15–22, 2017, according to the EIA. Demand rose 2.1% week-over-week and by 179,000 bpd or 2% year-over-year.
Any rise in gasoline demand has a positive impact on gasoline and oil (OIL) (DBO) prices. Higher gasoline (UGA) prices favor US refiners (CRAK) like Valero (VLO) and Holly Frontier (HFC).
US gasoline demand peak and low
US gasoline demand and gasoline prices are usually closely related. US gasoline demand hit a record high of 9,776,000 bpd in August 2016. On the other hand, demand hit 8,222,000 bpd in January 2017. It was the lowest level since February 2012.
US gasoline consumption estimates
US gasoline consumption averaged 9.18 MMbpd in 2015. It hit a record high of 9.32 MMbpd in 2016. US gasoline consumption is also expected to average 9.32 MMbpd in 2017.
The EIA expects that US gasoline consumption will average 9.34 MMbpd in 2018, which is 0.2% higher than 2017. US gasoline consumption will also hit the highest level ever in 2018. Higher demand boosts gasoline and oil (USO) prices. Oil producers (IEZ) (XLE) like Contango Oil & Gas (MCF), Stone Energy (SGY), and Whiting Petroleum (WLL) benefit from higher oil (UCO) prices.
The EIA will release weekly US gasoline demand data on January 4, 2017. Any increase in US gasoline demand has a positive impact on gasoline and oil (SCO) prices. In contrast, any decline in gasoline demand could weigh on gasoline and oil prices.
Next, we’ll discuss some crude oil price forecasts.