US gasoline inventories reach all-time high

HOUSTON (ICIS)–US gasoline inventories rose this week to levels never before recorded by the US government.

Gasoline saw a 5.9m bbl rise for the week, according to the US Energy Information Administration (EIA) on Wednesday.

This put inventories at 254.4m bbl, surpassing the next-highest level recorded in March 1990 of 251.1m bbl.

The east coast and Midwest regions saw the largest builds for the week, at around 3m bbl each. The US Gulf actually lost some ground, potentially from an outage at ExxonMobil’s refinery in Beaumont, Texas. The US refinery utilisation rate fell for the fifth consecutive week, but the outage and utilisation decrease were not enough to stop the overall increase.

Inventories have been rising since November, and at the beginning of 2016 the build steepened.

It is not unusual for stocks to build up at the start of a new year. The industry deals with the balancing act of using up the rest of the winter-grade gasoline, as well as dealing with summer-grade gasoline that starts hitting the market from producers.

This year, however, the glut hit record highs. The build is concurrent with extremely high levels of crude oil, which is oversupplied worldwide.