Gasoline and Hot Dogs

This Memorial Day weekend could be poised to bring late spring tidings to product tanker owners trading in the Atlantic Basin. A simple year‐on‐year comparison reveals that the US could be caught shorter‐than‐usual this season as far as gasoline is concerned. A peek into gasoline inventories indicates that they appear to be trending lower in the face of rising seasonal demand. The US Department of Energy’s Energy Information Agency, or EIA, reports that weekly demand for gasoline is in the range of 9.1 million barrels per day for the total US. While there is a fair bit of noise in the weekly reporting numbers, this total demand marks an increase of around 450,000 barrels per day of demand on a four‐week moving average basis. Conversely, inventories are reportedly lower than last year. While the opportunities for rising imports present strong demand fundamentals for product tankers, tonnage oversupply could certainly preclude a positive response in spot market rates. Download here