Increased waterborne oil shipments from the U.S. Gulf Coast to Florida reflect shifting population

Growth in Florida’s resident population is driving growth in transportation fuel consumption and is increasing waterborne transportation fuel shipments from U.S. Gulf Coast refiners. Twenty-one percent of combined motor gasoline, distillate fuel oil and jet fuel leaving the U.S. Gulf Coast (PADD 3) for the East Coast (PADD 1), which includes Florida, was shipped by tanker and barge so far in 2023, compared with 18% in 2010, according to our Petroleum Supply Monthly (Figure 1). Although some tanker and barge shipments occasionally go to other states along the East Coast, almost all go to Florida.

Consumption of motor gasoline, distillate fuel oil, and jet fuel in the states along the U.S. East Coast has been about the same this year compared with 2010. However, the method of delivery of these fuels from the U.S. Gulf Coast has changed as fuel receipts by waterborne vessel have increased more than fuel receipts by pipeline, indicating consumption growth in Florida. The state receives almost all the tanker and barge shipments from the U.S. Gulf Coast and lacks the infrastructure to move petroleum products to other states. These changes imply declines in consumption of transportation fuel in other U.S. East Coast states.

Year-to-date through July 2023, tanker and barge movements from the U.S. Gulf Coast to the East Coast accounted for 15% of East Coast motor gasoline consumption (measured as product supplied), up from 12% in 2010. Distillate fuel tanker and barge movements accounted for 12% (up from 7%), and jet fuel tanker and barge movements accounted for 18% (up from 11%) (Figure 2).

Like other East Coast states, Florida receives most of its petroleum products from U.S. Gulf Coast refiners. However, the state has no direct access to the two major pipelines that serve East Coast states, Colonial and Products SE. Instead, Florida receives most of its fuels shipped by water vessels from the U.S. Gulf Coast, although some portions of the state receive shipments by truck from Colonial Pipeline spurs that end in southern Georgia (Figure 3). The rest of the state’s fuels come from imports.

Florida is one of the fastest growing states in the country. The state’s population grew 18% between 2010 and 2022, from 18.8 million residents to an estimated 22.2 million residents. Populations in other East Coast states have also risen, but relatively slowly in comparison. Florida surpassed New York as the East Coast’s most populous state in 2014. The region’s second- and third-most populous states—New York and Pennsylvania—each grew by 0.3 million residents from 2010 to 2022. Indexed to 2010, Florida has grown more than any other East Coast state (Figure 4).

Driving and gasoline sales data from the U.S. Federal Highway Administration (FHWA) show more driving activity and motor gasoline consumption in Florida than in any other state in the East Coast region. Although all states faced reduced driving and gasoline sales during the COVID-19 pandemic, not all have returned to pre-pandemic levels of activity. Among the three most populous East Coast states, Florida returned to and surpassed its pre-pandemic level of driving activity—measured by vehicle miles traveled (VMT)—in 2022 and remains at higher levels through 2023, based on a 12-month moving average (Figure 5). Pennsylvania’s VMT returned to pre-pandemic levels this year, while New York’s VMT remains below pre-pandemic levels.

Factors other than resident population influence driving activity and are likely also affecting state-level VMT and motor gasoline consumption trends. These factors include:

• Size of the working age (age 15 to 64) population
• Number of employed persons
• Number and frequency of employees working from home
• Tourism or other visits from out-of-state residents
• Number of registered electric vehicles
• Availability and costs of transportation alternatives to personal cars

For questions about This Week in Petroleum, contact the Petroleum and Liquid Fuels Markets Team at 202-586-5840.