Very usefull links


News links




Dow Jones

Oil price



Views and News





Global trade is fast-growing and boosting fuel demand: Kemp




By John Kemp

Petroleumworld 01 29 2018

Freight movements in the United States and around the rest of the world are growing at some of the fastest rates this decade, which should provide a big boost for diesel consumption in 2018.

In the United States, the volume of freight moved by road, rail, pipeline, barge and air between September and November was around 6 percent higher than in the same period a year earlier.

Freight volumes are growing at some of the fastest rates since 2011, according to the freight transportation services index compiled by the U.S. Bureau of Transportation Statistics ( ).

Freight movements are being driven by an increase in coal deliveries to power plants, as well as increases in oil and gas drilling.

U.S. businesses have also finally managed to get their inventories of raw materials, unfinished work-in-progress and finished items under control.

The ratio of inventories to sales has fallen to 1.33, down from a peak of 1.46 in April 2016, and the lowest for three years, according to the U.S. Census Bureau.

The continued draw down in inventories is unsustainable and has left manufacturers, distributors and retailers boosting new orders to stop the erosion of their stock levels.

One result is a nationwide shortage of trucks and a scramble by shippers to secure enough freight capacity (“A shortage of trucks is forcing companies to cut shipments or pay up”, Wall Street Journal, Jan. 25).

Freight rates and shipment backlogs have been rising sharply as spare capacity inherited from the slowdown in cargo movements in 2015 and 2016 is used up.

The pattern is being repeated worldwide, with global trade growing at the fastest rate since 2011, according to the Netherlands Bureau of Economic Policy Analysis (“World Trade Monitor”, CPB, Jan. 2018).

The global economy is experiencing the strongest synchronised growth since the start of the decade with all the advanced economies in a cyclical upswing.

The rise in oil and other raw materials prices is also starting to produce an upswing in the commodity-dependent developing countries that were hit hardest when commodities prices started tumbling in 2014.

The current global expansion is expected to continue throughout 2018 and into 2019 which should support further rapid growth in freight volumes.

Since almost all freight is moved by trucks, railroads, barges, ships and aircraft that use diesel or jet fuel made from middle distillates, the economic expansion should provide a big boost for distillate demand in 2018.

Distillate consumption tends to be correlated with freight and industrial production so it was hit badly by the slowdown in 2015 and 2016.

But distillates are set to be the big beneficiary of the current global upturn, with diesel and jet taking over from gasoline as the fastest-growing source of fuel consumption in 2017 and 2018.

Story by By John Kemp from Reuters 01 26 2018

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

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

Any question or suggestions,
please write to:

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






Editor & Publisher:Elio Ohep/
Contact Email:

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: 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.