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Is US Gasoline Demand Helping Oil Bulls?

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Weekly US gasoline demand  

The EIA (U.S. Energy Information Administration) estimates that the US gasoline demand increased 1.4% to 9.8 MMbpd (million barrels per day) on July 13–20. The demand also increased 0.3% from a year ago.

A rise in the gasoline demand is bullish for gasoline and oil prices. Active US gasoline and crude oil futures have increased ~50.5% and ~63%, respectively, since June 21, 2017.

The United States Gasoline ETF (UGA) tracks US gasoline futures. UGA has increased ~52% since June 21, 2017. The VanEck Vectors Oil Refiners ETF (CRAK) increased 51% during the same period. CRAK has exposure to refining companies.

HollyFrontier (HFC), PBF Energy (PBF), and Delek Holdings (DK) have risen ~187%, ~111%, and ~102%, respectively, since June 21, 2017. These stocks were among the top percentage gainers in CRAK’s holdings during this period. These stocks account for 8.7% of CRAK holdings.

US gasoline consumption estimates  

US gasoline consumption averaged 9.32 MMbpd in 2017. Gasoline consumption could average 9.31 MMbpd in 2018 and 9.36 MMbpd in 2019, according to the EIA. The annual gasoline consumption could hit a record in 2019 if these projections are achieved.

Impact 

US gasoline demand was ~5.34% above its five-year average, which is bullish for gasoline and oil prices. Record gasoline demand in 2019 could also help gasoline and oil prices.

Read Venezuela and US Crude Oil Supplies Impact Oil Prices and Supplies and Weather Drive US Natural Gas Prices for the latest updates on crude oil and natural gas.

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