Gasoline prices down YOY and demand way up

Post Reply
dan_s
Posts: 34579
Joined: Fri Apr 23, 2010 8:22 am

Gasoline prices down YOY and demand way up

Post by dan_s »

Per EIA

The retail price for regular-grade gasoline in the United States on May 22, the Monday before Memorial Day weekend, averaged $3.53 per gallon (gal), 26% (or $1.24/gal) lower than the inflation-adjusted price a year ago. Memorial Day gasoline prices last year were the highest since 2012. The American Automobile Association (AAA) expects 6% more miles traveled this Memorial Day weekend compared with last year because of lower gasoline prices. Although retail gasoline prices have come down from a year ago, they remain higher than during the period from 2019 through 2021.

For the week ending May 19:
Total motor gasoline inventories decreased by 2.1 million barrels from last week and are about 8% below the five year average for this time of year. Finished gasoline inventories increased, while blending components inventories decreased last week.
Distillate fuel inventories decreased by 0.6 million barrels last week and are about 18% below the five year average for this time of year.

So, transportation fuels inventories are below the bottom of the 5-year range and we are heading into the highest demand period for transportation fuels. What happens when demand exceeds supply?

PS: Our crude oil inventories are also below the 5-year average and U.S. oil production declined ~100,000 barrels per day during the week ending May 19.
Dan Steffens
Energy Prospectus Group
Post Reply