Publications: Notes at the Margin

Gasoline: The New Residual Fuel (January 13, 2020)


Gasoline consumers may be the big winners from the IMO 2020 transition to very low sulfur fuel oil. In some parts of the United States, prices may fall below $1 per gallon by summer. The low prices will result from the very high prices being offered for low-sulfur ship fuel, the effort by refiners to produce as much of the fuel as possible to reap the profits, the surplus of light sweet crude exported from the United States, and the aggressive expansion of refining capacity in Asia. The consequence of those developments could be a flood of gasoline and maybe even diesel into world markets. Consumers would benefit. The refiners unable to produce significant volumes of the low-sulfur fuel demanded by shipowners would lose.


To receive the full report along with futures issues of Notes at the Margin, please Contact Us or send us an Information Request for subscription information.