Total domestic gasoline stocks decreased by 1.2 million bbl to 228.8 million bbl, according to the Energy Information Administration’s latest weekly petroleum status report. An increase in gasoline demand, 323,000 b/d over the previous week, to 9.46 million b/d helped to decrease stocks. If gasoline supply remains low – which currently sits at 7.4 million bbl lower than last year at this time — amid robust demand, pump prices will likely continue to decline for the majority of motorists. Since Monday, the national average for unleaded regular gasoline has decreased by a penny to $2.64.
The West Coast region, which has seen gas prices spike in recent weeks due to supply challenges, may not be out of the clear yet. Several refinery outages across the region recently have led to tighter stock levels. And, with refinery maintenance season underway and utilization rates lower, supply challenges are likely to persist a little longer meaning continued increases at the pump. Earlier this week, reports emerged that Chevron’s 290,500-b/d El Segundo refinery in the Los Angeles area reported unplanned flaring, while Shell’s San Francisco Bay Area 158,000-b/d Martinez refinery reported a process unit also shutdown. As the refineries work to bring production capacity back to normal, prices are likely to remain high in the region through the week. Additionally, PG&E’s power cuts may take some gas stations offline, potentially increasing prices in impacted areas due to tighter supplies, since pumps are unable to dispense gasoline without electricity.