Sources of Product Price Pressures
•Tight world petroleum markets translate to high crude oil prices and higher product cracks
•Imports likely to be more expensive due to U.S. product specification changes & high world demand
•Increased potential of U.S. price volatility from:
–Tight world markets (low inventories),
–Increasing number of fuels,
–High U.S. capacity utilization
•But higher product margins near term may encourage more U.S. refinery capacity expansion
SIn summary, we can expect price pressure not only from crude oil prices, but also from higher cost imports and even increased potential for price volatility.

SIf there is a silver lining to this picture, it is that increased margins should eventually encourage more U.S. refining capacity expansion in the future.