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Demand for petroleum products expected to grow in the USA on continuing economic recovery

April 12/2021

MOSCOW (MRC) -- The EIAs April Short-Term Energy Outlook (STEO) expects vaccinations and fiscal stimulus to support continuing economic recovery and drive demand growth for petroleum products in the United States, reported Hydrocarbonprocessing.

Gasoline and distillate fuel consumption is expected to increase from last summer, but remain less than in 2019.

As some of the economic and behavioral effects of COVID-19 subside over the next year, we forecast that US demand for transportation fuels will increase. We forecast that gasoline consumption in 2021 will peak in August at 9.1 million barrels per day (b/d), more than the 8.5 million b/d we saw in August 2020 but less than the 9.8 million b/d in August 2019. We forecast that gasoline consumption during the summer of 2021 will average 8.8 million b/d, a 1.0 million b/d (13%) increase from summer 2020 but a 0.7 million b/d (7%) decrease from 2019.

The retail price of regular-grade gasoline in the United States is forecast to average USD2.78 per gallon (gal) during summer 2021, 72 cents/gal more than last summers average of USD2.06/gal. The forecast of significantly more global economic activity this summer compared with last summer contributes to higher crude oil prices, which are the largest determining factor in US gasoline prices.

The response to the COVID-19 pandemic has not affected US diesel fuel demand as much as it has affected gasoline demand. We forecast that consumption of distillate fuel, which includes diesel fuel and heating oil, will average 4.0 million b/d this summer, an 11% increase (400,000 b/d) from last summer when distillate consumption levels reached their lowest point for the summer in the United States since 2009. However, distillate consumption is expected to be nearly equal to 2019 levels (down less than 1%).

As MRC wrote before, gasoline sales in the United States have moved year on year into positive territory for the first time - on the one-year anniversary of the first major declines that resulted from COVID-induced stay at home orders. However, demand still trails pre-pandemic levels by a considerable margin, according to the latest data from Oil Price Information Service (OPIS) by IHS Markit.

We remind that Chemical Activity Barometer (CAB), a leading economic indicator created by the American Chemistry Council (ACC), rose 1.2% in March on a three-month moving average (3MMA) basis, following a 1.0% increase in February. On a year-over-year (Y/Y) basis, the barometer rose 5.5% in March. The unadjusted data show a 1.2% gain in March following a 0.9% gain in February, ACC said. The diffusion index rebounded to 82% in March, well above the long-term average of 58%.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 2,220,640 tonnes in 2020, up by 2% year on year. Only shipments of low density polyethylene (LDPE) and high density polyethylene (HDPE) increased. At the same time, polypropylene (PP) shipments to the Russian market reached 1 240,000 tonnes in 2020 (calculated using the formula: production, minus exports, plus imports, excluding producers' inventories as of 1 January, 2020). Supply of exclusively PP random copolymer increased.


mrcplast.com
Author:Margaret Volkova
Tags:PP, PE, crude and gaz condensate, PP block copolymer, homopolymer PP, propylene, LDPE, HDPE, ethylene, petrochemistry, Russia, USA.
Category:General News
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