|SHistorically, capacity abroad has been very
competitive in the U.S. gasoline market, as demonstrated by gasoline imports
being a part of our supply even when refining capacity was in excess, and
those volumes have grown, doubling in size since 1990.
|SThis chart focuses on the increases in
gasoline supply from domestic refineries and from imports. From 1998 to 2003, the increases in
domestic production and imports have been similar, with net imports
comprising 56% of the supply increase and production supplying 44 percent.
|SGasoline imports have probably been an
economic source of supply as implied by refinery utilization being lower in
all years from 1999 through 2003 than in 1998.
|SIn 1998, U.S. refining capacity utilization
was at an historic high and very near maximum input levels during the summer
gasoline season. While utilization has
been somewhat lower since then, only modest capability to produce more
gasoline has existed during the summer period. Moreover, refining capacity increases from
1995 to 2003 have not been sufficient to produce the increases in volume of
gasoline sold in the United States. As
a result, gasoline imports increased.
|SIn the next few slides, we are going to
explore recent historical imports to gain some insights into what the future