Publications: Notes at the Margin

The Gasoline Mystery Continued (July 11, 2016)


This Notes at the Margin focuses on three issues: US gasoline consumption, price expectations derived from the BP Prudhoe Bay Royalty Trust (BPT), and the return of the global petroleum surplus. With regard to gasoline, we provide further detail on the differences between data published weekly and monthly by the US Department of Energy. In the process, we introduce a new data series, "adjusted weekly petroleum disappearance," that currently shows a lower year-over-year growth rate (1.2 percent) than the raw data published by the DOE. We also introduce new expectations of forward prices derived from the BP Prudhoe Bay trust. BPT share prices have recently increased while field production has remained essentially flat. And last we note that the slow growth in gasoline consumption is consistent with the return of surplus supplies. Contrary to most statements, balance has not returned to the global oil market.


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