|SIn the next 15 years, we see a significant shift in demand
for petroleum-based gasoline versus distillate that is the result of recent
|–The Energy Policy Act of 2005 included a mandated use of
renewable fuels, and ethanol was the only fuel that could practically meet
the mandate. The increased use of
ethanol requires less petroleum-based gasoline to meet demand.
|–The Energy Independence and Security Act of 2007 increased
the renewable fuel mandate, requiring even more ethanol blending. In addition, the legislation increased
light-duty vehicle efficiency standards, which reduces the future need for
|SWhile still not the shift that Europe has seen, U.S.
refiners will be facing a significant change in product mix that will impact
|–Overall liquid fuel demand is not expected to grow much
over the next 30 years – perhaps about 0.2% per year (annual average) as
shown in EIA’s 2009 outlook.
|–But distillate demand may still grow fairly strongly, while
gasoline demand declines; however distillate growth needs to recover from the
recession’s impact before that occurs.
|SThe increased use of biofuels and increased light-duty
vehicle efficiency standards result in a decline in petroleum-based gasoline
of about 580 thousand barrels per day (7%) from 2008 to 2023.
|SPetroleum-based distillate, on the other hand, continues to
grow (590 thousand barrels per day or 11%).
Increased use of biodiesel, distillate from coal-to-liquids (CTL) and
from biofuels-to-liquids (BTL) processing is decreasing the petroleum
distillate need by 360 thousand barrels per day. If that non-petroleum-based distillate does
not materialize, petroleum-based distillate requirements might increase
substantially more than what is shown in the table.