Europe and the U.S. – Example of International Product Trade
•We know the U.S. depends on product imports – especially those from Europe
•Product trade between Europe and U.S has increased from 1995 to 2005
•Working together because it benefits both due to different supply/demand balances
•Distillate product supply concerns may grow more for EU, but impacts U.S.
•Product quality issues important -- but not part of this presentation
SEurope and the U.S. provide an interesting example of how international product trade can benefit consumers.

SThe U.S. depends on product imports – particularly gasoline.  But this is not simply because it is difficult to expand refining capacity in the U.S.  There are some very economic sources of product available as imports – particularly from Europe.

SIn the following slides, the presentation will illustrate how these two regions work together to balance supply and demand.

SThe presentation will highlight why distillate is probably more of a concern for Europe than for the U.S., but how Europe resolves its issues will affect the U.S.

SProduct quality changes are also important.  Both Europe and the U.S. are moving to low sulfur products.  These changes will likely play an important role over the next few years, but how that will evolve is highly uncertain.  As a result, we will not address that topic further in this presentation.