EIA: US distillate demand returned to 2019 levels earlier than gasoline and jet fuel demand
Published by Pippa Luck,
The combination of increases in both travel and economic activity in the US has contributed to more demand for gasoline, distillate, and jet fuel, as reflected in the product supplied data of EIA’s Weekly Petroleum Status Report (WPSR). Although demand has increased for all three of these products from their 2020 lows, the extent of the demand growth has differed by product.
According to the 23 June WPSR, which includes data through 18 June, demand for all three fuels was lower than during the same week in 2019, the year before COVID-19 mitigation efforts began in the US. For the week ending June 18, the four-week average demand for gasoline was 94% of the four-week average for the same week in 2019, distillate was 98%, and jet fuel was 74%. At their lowest points in 2020, gasoline demand fell to 56% of its corresponding 2019 level, distillate demand to 80%, and jet fuel demand to 31%.
EIA estimates that product supplied by the volume of petroleum products delivered out of the primary supply chain. Although product supplied is a reasonable proxy for consumption, weekly data may show volatility due to temporary demand, trade, or inventory fluctuations. As a result, a four-week rolling average often provides a better indication of longer-term consumption trends.
Based on rolling four-week averages, US gasoline demand fell from 9.3 million bpd during the week of 13 March 2020 (when President Trump declared a national emergency) to 5.3 million bpd on 24 April 2020. Beginning in March 2021, however, demand started growing again, and consumption rose above 9.0 million bpd during the week of 21 May for the first time since 20 March 2020. For the week ending 18 June, gasoline product supplied averaged 9.1 million bpd, 94% of the 2019 level for the corresponding week.
Demand for US jet fuel has also increased from its 2020 lows as personal travel has increased, but it has not approached its 2019 levels as closely as gasoline and distillate have. International travel restrictions, concerns about rising COVID-19 case counts in other countries, and reduced business travel have probably contributed to the relatively slower return in jet fuel demand. In addition, the growth in jet fuel demand may be slower than gasoline and distillate fuel if travellers continue to avoid flying. For the week ending 18 June, jet fuel product supplied averaged 1.3 million bpd, 74% of 2019 levels for the corresponding week.
COVID-19 did not affect distillate consumption as much as gasoline or jet fuel consumption. Distillate consumption in the US is driven by economic activity and is more directly affected by changes in freight transport than by reduced travel or work-from-home trends. Demand for distribution of necessities, such as food and medical supplies, and increased home deliveries for goods likely contributed to relatively stable demand for distillate fuel during 2020. For the week ending 18 June, distillate product supplied averaged 3.9 million bpd, 98% of 2019 levels for the corresponding week.
Read the article online at: https://www.hydrocarbonengineering.com/refining/01072021/eia-us-distillate-demand-returned-to-2019-levels-earlier-than-gasoline-and-jet-fuel-demand/
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