From EIA This Week in Petroleum Aug 9, 2017
Gasoline production by U.S. refiners and blenders is running near record levels over the first seven months of 2017, with four-week rolling average production well above its five-year average and close to the top of its five-year range. Despite growing domestic and foreign demand leading to draws from gasoline stocks over the past seven consecutive weeks, gasoline inventories also continue to remain above their five-year average levels.
Growth in U.S. gasoline production since March is the result of record-high refinery runs. For the week ending April 21, U.S. refinery runs exceeded 17.5 million barrels per day (b/d) for the first time since EIA began publishing the weekly data series in 1990. Refinery runs have since exceeded this threshold six additional times, reaching an all-time high of 17.8 million b/d the week ending on July 28.
Net production of finished motor gasoline (unadjusted refiner and blender net production of finished motor gasoline less use of fuel ethanol to isolate the petroleum component) averaged 9.3 million b/d for the week ending July 28 (Figure 1). This quantity is 70,000 b/d below the five-year high, but still more than 511,000 b/d above the five-year average.
Despite historically high gasoline production levels, cumulative draws from gasoline inventories beginning with the week ending June 16 totaled 14.8 million barrels, resulting in a 6.5% reduction in inventory levels to 227.7 million barrels as of July 28. The July 28 inventory level is nearly 12.6 million barrels below the previous five-year high, but still 6.2 million barrels above the previous five-year average (Figure 2). High levels of exports and product supplied (a measure of domestic demand) are responsible, at least in part, for these recent draws.
Total gasoline exports, including finished gasoline and blending components, began 2017 nearly 90% above the five-year average and remained more than 80% above the average until February 10. Since then, exports of gasoline have trended above the five-year average and along the top of the five-year range. While estimated gasoline exports have slipped the past two weeks, they remain nearly 26,000 b/d above the five-year average as of July 28
EIA’s August Short-Term Energy Outlook forecasts that motor gasoline consumption will be virtually unchanged in 2017, with product supplied expected to increase by 3,000 b/d (less than 0.1%), to an average of slightly more than 9.3 million b/d for the year. In 2016, gasoline consumption increased by 1.6%. The flat forecast for gasoline consumption reflects slower expected growth in non-farm employment and an expected increase in the retail price of gasoline. Gasoline consumption in 2018 is expected to grow by 27,000 b/d (0.3%) from its projected 2017 level.