U.S exports of diesel fuel in April of this year averaged 387,000 barrels per day, up almost seven-fold from 59,000 barrels a day in the same month a year earlier.
U.S. gasoline exports in April of this year averaged 202,000 barrels a day, the most for the month since 1945, when America was sending fuel overseas to ease supply shortages in other countries during World War II. Gasoline exports in April 2007 were almost half at 116,000 barrels per day.
Residual fuel exports in April of this year were 377,000 barrels per day, the fourth highest level for any month, and up 10 percent from 344,000 barrels per day a year earlier.
Just curious. Given the quite evident existing supply side balance of refined product, how is an accelerated domestic drilling program going to lower U.S. refined product prices?
It will reduce the price of the raw material, allowing refineries to make a profit at a lower sale price.
No refinery can undercut any other right now, because they are barely scraping a profit out now (because of the supply glut).
Every gallon of gas has a fixed bottom price based on crude oil prices. They also have a maximum price, or at least a strong inflection point, which appears to be about $4.00. Above that people stop driving.
That’s why gas prices have not gone up as much as oil prices have. They simply couldn’t raise the price more, not enough people were willing to pay.