U.S. distillate fuel oil stocks are on course to fall critically low between now and the middle of the year, creating conditions for a potential spike in both crude and fuel prices, unless demand from freight firms falls.
Distillate inventories slipped by another 2 million barrels last week to 120 million barrels, according to data from the U.S. Energy Information Administration (“Weekly petroleum status report”, EIA, Feb. 16).
Stocks are currently 28 million barrels (18%) below the pre-pandemic five-year seasonal average for 2015-2019 and at the lowest level for the time of year since 2014.
Three-quarters of distillate fuel oil is sold to trucking firms, railroads and shipping companies to move farm products, industrial raw materials and manufactured items.
Low inventories are a symptom of the booming demand for freight amid a rapid recovery from the coronavirus recession led by the manufacturing sector.
https://www.hellenicshippingnews.com/u-s-diesel-stocks-set-to-fall-critically-low/
Distillate inventory levels (updated every Thursday): https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WDISTUS1&f=W Lowest level in 2008 crisis was 105. Currently 112.
h/t mark000