En Español

Very usefull links


News links




Dow Jones

Oil price



Views and News





European gasoline demand by U.S. stalls, casting shadow on demand



Petroleumworld 06 30 2017

Europe's steady exports of gasoline to the United States have slowed substantially this year as tanks filled in the world's largest consumer nation and once-meteoric demand growth slowed.

The drop in gasoline shipments to the densely populated U.S. East Coast is forcing European exporters to turn to less steady buyers in West Africa and compete with refineries elsewhere in the United States to export to Latin America and Asia.

Deliveries to the U.S. Atlantic Coast from Northwest Europe this month are set to fall 35 percent compared with the 400,000 barrels per day (bpd) that sailed on the route in June 2016, according to U.S.-based ship-tracking firm ClipperData.

May imports, at 246,000 bpd, were down nearly 20 percent versus year-earlier levels.

"Fears of a replay of last year's gasoline glut are deterring U.S. importers," said Matt Smith, director of commodity research at ClipperData.

"This trend looks set to continue, at least through early July, leaving higher volumes of gasoline to remain within Northwest Europe, as well as ticking higher to Asia."

Starting in 2015, U.S. gasoline demand grew substantially, clocking in 260,000 bpd higher that year and expanding by another 130,000 bpd last year, according to the U.S. Energy Information Administration.

But demand was down 2.7 percent in the first quarter of this year, and the four-week average was also lower year-on-year despite hitting all-time highs in two of the past five weeks.

In another sign of the slowdown, three oil tankers, the Atlantic Pegasus, the Ardmore Seavantage and the CPO China, are ballasting - or sailing with no product inside them - from Europe to the United States.

Tankers often sail empty from one market to another when freight rates in the destination are strong, but it is highly unusual for the United States not to need European gasoline over the peak-demand summer months.

"It just doesn't make sense to ship," one trader said of the gasoline arbitrage to the United States.

Europe can also send those barrels to other regions, including West Africa, which took some 286,000 bpd from Europe in 2016, according to industry research group Wood Mackenzie, and Latin America, where refinery shutdowns have boosted the need for imports.

But U.S. refineries have been churning out, and exporting, record volumes of fuel this year.

This has kept U.S. gasoline inventories near the top of the five-year average, pressed demand to ship gasoline on a key route within the country to a six-year low - and made plenty available to export to Latin America.

"Demand from Latin America is going to hold up - and that will bode well for U.S. refiners," said Steve Sawyer, head of refining with consultancy FGE.

"European refineries are the world's marginal producers. If U.S. gasoline demand isn't as strong as we think it is, European refineries will feel the pain first."

Story by Libby George; Additional reporting by Ron Bousso; Editing by Dale Hudson by Reuters.

06 29 2017

We invite all our readers to share with us
their views and comments about this article.
Write to editor@petroleumworld.com

By using this link, you agree to allow PW
to publish your comments on our letters page.

Any question or suggestions,
please write to: editor@petroleumworld.com

Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8,10 +/ 800x600 pixels





Contact: editor@petroleumworld.com,

Editor & Publisher:Elio Ohep/
Contact Email: editor@petroleumworld.com

CopyRight © 1999-2016, Paul Ohep F. - All Rights Reserved. Legal Information

PW in Top 100 Energy Sites

CopyRight©1999-2017, Petroleumworld   / Elio Ohep - All rights reservedThis site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission fromPetroleumworld or the copyright owner of the material.