According to the US Energy Information Administration (EIA), the retail price of regular-grade gasoline in the US will average $2.76 per gallon during the summer of 2019 (April through September). The expected average by EIA’s reckoning is down by 3% from the 2018 summer average of $2.85/gallon, mainly because EIA expects crude oil prices will be lower than last summer.
Changes in US retail gasoline and diesel prices are typically influenced by movement in crude oil prices because gasoline and diesel taxes and distribution costs are generally stable across the United States.
The Brent crude oil price is forecasted to average $1.60/gallon this summer, compared to an average of $1.78/gallon, last summer.
EIA expects that domestic US refinery production of motor gasoline, including gasoline blendstock output, will be 8.6 million barrels per day (b/d) this summer, or 80,000 b/d higher than last summer. USA will be a net exporter of total gasoline, including blending components, during the summer months and export an average of 87,000 b/d from April through September in 2019. If these forecasts come to pass, this summer could well be the first time since 1960 that the United States exports more gasoline on average than it imports during the summer months.
EIA forecasts US motor gasoline consumption during the summer will average 9.5 million b/d, up 29,000 b/d (0.3%) compared with last summer and about the same as the record set in summer 2017. EIA projects that gasoline inventories will total 232.0 million barrels at the end of September 2019, or about 7.6 million barrels lower than last year’s level.
U.S. retail diesel fuel prices projected in the Summer Fuels Outlook average $3.09/gallon this summer, down from $3.22/gallon last year. EIA expects that U.S. consumption of distillate fuel, including diesel fuel and heating oil, will average 4.1 million b/d this summer, or 20,000 b/d more than last summer.
EIA expects slower growth in the primary drivers of distillate consumption, including economic growth, industrial output, international trade activity, and crude oil and natural gas drilling activity, all of which contribute to higher trucking activity.
For more information on EIA’s forecast for petroleum markets this summer, check out the Summer Fuels Outlook.