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Short-Term Energy Outlook

Release Date: January 15, 2019  |  Next Release Date: February 12, 2019  |  Full Report    |   Text Only   |   All Tables   |   All Figures

Petroleum Products

Gasoline prices:

The front-month futures price of reformulated blendstock for oxygenate blending (RBOB, the petroleum component of gasoline used in many parts of the country) settled at $1.43 per gallon (gal) on January 10 (Figure 2), mostly unchanged from December 3. The RBOB–Brent crack spread (the difference between the price of RBOB and the price of Brent crude oil) was also mostly unchanged during the same period, settling at -4 cents/gal.

Figure 2: Historical RBOB front-month futures prices and crack spread

The RBOB–Brent crack spread averaged 1 cent/gal in December, the lowest for that month since 2008. STEO estimates U.S. gasoline consumption decreased 2% year-over-year in December, bringing estimates of full-year 2018 U.S. gasoline consumption to show a decline compared with 2017, the first annual decline since 2012. Exports continue to remain an important source of demand growth for U.S. refiners, however. Weekly estimates of gasoline exports reached an all-time high in early December, totaling more than 1.3 million barrels per day.

Ultra-low sulfur diesel prices:

The ultra-low sulfur diesel (ULSD) front-month futures price for delivery in New York Harbor settled at $1.91/gal on January 10 (Figure 3), an increase of 2 cents/gal from December 3. The ULSD–Brent crack spread (the difference between the price of ULSD and the price of Brent crude oil) increased by 2 cents/gal to settle at 44 cents/gal during the same period.

Figure 3: Historical ULSD front-month futures price and crack spread

ULSD–Brent crack spreads fell in late December, but remained higher than the five-year (2013–17) average for December, averaging 43 cents/gal. STEO estimates U.S. distillate consumption was virtually unchanged year-over-year in December, at 4 million b/d, but estimates of full-year distillate consumption in 2018 were at the highest levels since 2007. Distillate inventories were 5% less than the five-year average at the end 2018, which could contribute to higher distillate prices or crack spreads if colder-than-normal weather leads to higher home heating oil consumption in the coming months.

U.S. Petroleum and Other Liquids
  2017201820192020
Crude Oil prices (dollars per barrel)
WTI Spot Average 50.7965.0654.1960.76
Brent Spot Average 54.1571.1960.5264.76
Imported Average 48.9861.5748.9054.25
Refiner Average Acquisition Cost 50.6864.1652.0657.76
Retail prices including taxes (dollars per gallon)
Regular Gasoline 2.422.732.472.62
Diesel Fuel 2.653.182.943.13
Heating Oil 2.513.012.853.04
Production (million barrels per day)
Crude Oil 9.3510.9312.0712.86
Natural Gas Plant Liquids 3.784.384.975.26
Fuel Ethanol 1.041.051.041.04
Biodiesel 0.1040.1230.1440.158
Consumption (million barrels per day)
Motor Gasoline 9.339.299.359.35
Distillate Fuel Oil 3.934.144.164.19
Hydrocarbon Gas Liquids 2.642.983.143.32
Jet Fuel 1.681.711.781.81
Total Consumption 19.9620.4620.7721.01
Primary Assumptions (percent change from previous year)
U.S. Real GDP Growth 2.22.92.72.0
Heating Degree Days -1.311.0-1.0-0.6
Distillate-weighted Industrial Production 3.02.92.31.0

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