API: January Gasoline Demand Highest for Month since 1945
OAKHURST, N.J. (DTN) -- The American Petroleum Institute reported consumer
gasoline demand, as measured by total motor gasoline deliveries, averaged 8.9
million bpd for the month of January, 2.7% lower than the prior month but 1.9%
more than January 2018 and the strongest for January since 1945.
Demand for reformulated-type gasoline, which is consumed primarily in urban
areas, increased 0.9% year-over-year to 2.9 million bpd in January. By
contrast, conventional gasoline is used more in rural areas and rose 2.4%
year-over-year to 6.0 million bpd.
API data show January distillate deliveries were 4.2 million bpd, 2.4%
higher than a month earlier but 3.3% lower than January 2018.
About 96% of distillate demand in January was for ultra-low sulfur
distillate, which was driven by road freight transportation activity. The
Bureau of Labor Statistics' Producer Price Index for freight trucking increased
by 8.0% year-over-year in January amid strong activity and a continued shortage
According to API, the remaining 4.0% of distillate demand was high sulfur
distillate fuel, which is a heating fuel in the residential and commercial
sectors and a marine fuel when blended to upgrade heavy fuel oil. In January,
HSD deliveries tumbled by 30.8% versus the month prior and 17.4% versus those
of January 2018. API said this was the lowest HSD demand on record for the
month of January.
U.S. petroleum demand, as measured by total petroleum deliveries, was 20.7
million bpd in January, down 0.2% from the month prior but up 1.1% from January
2018 and the strongest for the month since 2005.
"Despite strong domestic demand, total U.S. petroleum inventories in January
were 5.8% above their historical five-year average. Notably, however, U.S.
petroleum exports decrease by 7.5 mb/d with lower exports of crude oil and
refined products, which may be indicative of slowing global oil demand and
economic growth," said API.
U.S. crude oil production of 11.9 million bpd in January, again number one
in the world, marked the highest monthly output on record. The increased
production reflects the rise in drilling activity over the past quarter, which
Baker Hughes reported an average of 878 oil-targeted rigs in fourth quarter
2018, up from 863 oil rigs in the third quarter 2018. The rig count slipped to
an average of 866 in January, so further production growth may hinge on the
extent to which the backlog of drilled but uncompleted wells begins to be drawn
down. Energy Information Administration data show nearly 8,600 DUCs as of
Natural gas liquids production, a coproduct of natural gas production, was
4.8 million bpd in January, the highest on record for any month.
U.S. refineries set new records for the month of January with throughput of
17.3 million bpd and refinery capacity utilization of 93.1%.
Data show total petroleum inventories in January were 1.28 billion bbl,
which was virtually unchanged from December but 5.7% over January 2018. Total
inventories are now 5.8% above the average of the five-year range. Within the
January total, crude oil inventories rose 1.4% month-over-month while refined
product stocks declined 0.9%.
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