We are getting into the peak summer driving season and gasoline demand has been hitting all-time highs. You might think that inventories would be drawing down and that the U.S. would need to import more gasoline and gasoline blending components. But not so. U.S. refineries are cranking out the products. Gasoline stocks are up 10% from a year ago—15 million barrels (MMbbl) higher than the top of the five-year range—and last week gasoline inventories made a contra-seasonal move upward, increasing by 1.4 MMbbl. Net exports for the first quarter were up almost five times the same period in 2015. But what does all this mean for refined product markets in general, and gasoline balances in particular? Today, we examine the state of U.S. petroleum product markets.
The upswing in U.S. gasoline demand is nothing new. RBN blogged about it this time last year in King of the Road (Again) and covered issues related to delivering gasoline, diesel and jet fuel to Northeast markets a few weeks back in Move It on Over. In the Energy Information Administration’s (EIA) June 2016 Short-Term Energy Outlook, gasoline consumption this summer was projected to average 9.5 MMb/d, a solid 1.9% higher than the summer of 2015, which was a strong demand season itself. What really stands out, though, is that even with high domestic demand for gasoline, net U.S. export volumes remain impressive. Figure 1 shows EIA net exports of gasoline (exports less imports of finished motor gasoline and motor gasoline blending components) and net exports of distillates (exports less imports of distillate fuel oil and kerosene-type jet fuel). The graph on the left is the total of net gasoline and distillate exports, showing the huge shift of the U.S. from a net importer of about 1.5 MMb/d in 2006 to a net exporter of about 1.2 MMb/d over the past six months. The graph on the right in Figure 1 focuses on the 2012-16 timeframe and splits net exports into gasoline (green line) and distillates (brown line). Both are still trending higher, but the big news is gasoline, which has moved well into the net export category since late 2015 (purple oval).
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About the song
“Hot Fun in the Summertime” was written by Sylvester Stewart (Sly Stone) and appears as the third song on side two of Sly and the Family Stone’s Greatest Hits compilation album. The song is a memorable upbeat pop tune celebrating all things fun done during the summer months. It was originally intended to go on an album along with “Everybody is a Star” and “Thank You,” but the album was never completed so these three songs ended up on the Greatest Hits album that was released in 1970. Released as a single in July 1969, it went to #2 on the Billboard Hot 100 Singles chart. The song has been covered by such artists as The Beach Boys, The Party, Manhattan Transfer and Dave Koz. Personnel on the record were: Sly Stone (vocals, keyboards), Freddie Stone (vocals, guitar), Larry Graham (vocals, bass), Rose Stone (vocals), Cynthia Robinson (trumpet), Jerry Martini (saxophone), Greg Errico (drums), and uncredited string players.
Greatest Hits is a compilation album that contains all the singles released by the band between 1967-70. Released in November 1970, the album went to #1 on the Billboard Top R&B and #2 on the Billboard 200 Albums charts. It has been certified 5x Platinum by the Recording Industry Association of America.
Sly and the Family Stone was an American soul/rock band formed in San Francisco in 1966 by Sly Stone, Freddie Stone, Rose Stone, Larry Graham, Cynthia Robinson, Jerry Martini and Greg Errico. Their music drew from a variety of sources to create what some writers called “psychedelic soul.” After the band’s featured appearance at Woodstock and in the film documentary of the event, Sly and the Family Stone were a hit-making machine and remained so until Sly’s drug troubles led to the original group’s dissolution in 1975. Sly continued to tour with a revolving crew of musicians under the name “Sly and the Family Stone” until his personal demons forced him to retire in 1987. They released 10 studio albums, two live albums, six compilation albums, and 19 singles. They were inducted into the Rock and Roll Hall of Fame, and the Vocal Group Hall of Fame, and received the R&B Foundation Award. Original Family Stone member Cynthia Robinson died in 2015 at the age of 71. Sly Stone, now 80 years old, lives by himself in a house in an anonymous Los Angeles suburb.
