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Energy Tomorrow Blog

API Reports: Economy, Petroleum Demand Have Gained Momentum

monthly-stats-report  oil demand  economic recovery 

Dean Foreman

Dean Foreman
Posted March 18, 2021

API’s latest industry outlook affirms the extent of recoveries in the U.S. and global economies, as well as rising demand for oil and natural gas.

For the past two quarters, API’s data and analysis have indicated these comebacks were underway, and this is visible in the March Monthly Statistical Report (MSR), based on February data, and API’s quarterly Industry Outlook.

The recoveries come on the tailwind provided by nearly $20 trillion of economic stimulus around the world. We could be poised for the largest two-year oil demand increase (9.2 million barrels per day, mb/d) on record since 1950 and new record highs of demand (102.4 mb/d) by the fourth quarter of 2022.

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Is the World About to See an Oil Shortage?

oil supply and demand  production  global energy 

Dean Foreman

Dean Foreman
Posted February 24, 2021

It’s possible we could be headed for a shortfall in global oil supply as soon as next year – pretty remarkable considering where oil demand was last spring, with economies slowing under the weight of the pandemic.

Based on projected rising demand, the natural production decline from existing wells and decreases in drilling activity and industry investment – especially in the U.S. – the world’s oil needs could outpace production in 2022. An undersupply potentially could put upward pressure on costs, impacting consumers, manufacturers and, generally, any process that utilizes oil.

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MSR: Oil Demand Nears January 2020 Levels

monthly-stats-report  oil demand 

Dean Foreman

Dean Foreman
Posted February 18, 2021

As oil prices rallied this past week, headlines suggested that oil demand recovery is expected to pick up speed (subscription required) later this year. However, API’s latest Monthly Statistical Report, based on January data, suggests that U.S. oil markets already kicked off 2021 with a remarkable month:

Total U.S. petroleum demand returned to within 1.2% of its level from January 2020 despite the pandemic; refining and petrochemical demand for other oils – naphtha, gasoil, propane/propylene reached a record-high level (6.5 million barrels per day, mb/d) and 33.1% share of total U.S. petroleum demand; and the lowest U.S. crude oil imports for January since 1992 propelled U.S. petroleum net exports.

Consider this: For all of the economic pain and dislocation caused by the 2020 COVID-19 recession, U.S. petroleum demand returned to within a hair of its pre-COVID levels and well within the five-year range. 

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Production of Pandemic Essentials Helps Nation, Industry as 2021 Opens

monthly-stats-report  economic recovery  demand  petroleum products 

Dean Foreman

Dean Foreman
Posted January 14, 2021

API’s latest Monthly Statistical Report (MSR) underscores the importance to industry of producing essential materials during the pandemic – including sterile packaging, medical plastics and antimicrobial coatings, including polymers.

Naphtha and gasoil in refining and petrochemicals increased 10.3% year over year (y/y) in December to a record-high of 5.9 million barrels per day (mb/d), or 31.3% of total U.S. petroleum demand. Again, industry benefited from this demand and in the process helped the nation respond to the pandemic. The technical term for that is “win-win.”

December also produced an important milestone – confirmation that the U.S. was a petroleum net exporter on an annual basis for the first time in more than 60 years. It’s remarkable given the headwinds of COVID-19 and increased pressure for nations to become self-reliant. The abundance, affordability and empowering nature of U.S. petroleum has helped cut through pessimism about global trade.

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Spotlight on Progress – Industry-wide Resilience and Opportunities for Growth

economic growth  demand  women in energy industry 

Amanda Eversole

Amanda Eversole
Posted December 18, 2020

Last week, I was honored to participate in the Women’s Business Enterprise National Council’s (WBENC) Energy Week and present at the State of Energy Industry Webinar, alongside a distinguished group of panelists representing every segment of the natural gas and oil industry to discuss the challenges facing the sector, as well as the opportunities for natural gas and oil operators in the year ahead.

This industry, like many others, has navigated the coronavirus pandemic, the nation’s racial reckoning, the election season and the ongoing economic fallout from widespread shutdowns. Across the board, API members have demonstrated unwavering resilience, finding ways to deliver essential energy products while protecting the health and safety of our workers, communities and the environment.

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Normalcy Returning to Natural Gas and Oil Markets

monthly-stats-report  demand  economic recovery 

Dean Foreman

Dean Foreman
Posted December 17, 2020

Celebrating normalcy long has marked Americans’ emergence from a variety of national crises. It’s the same with COVID-19. As we emerge from the pandemic, we dearly want to celebrate a return to normal. Thankfully, as the economy recovers, natural gas and oil are doing their part.  

API’s new Monthly Statistical Report (MSR) and quarterly Industry Outlook show our oil industry’s fortitude and resiliency through an unprecedented period.

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Consumer Spending and Investment Could Kickstart New Economic Growth

economic growth  oil and natural gas development  global demand  consumers 

Dean Foreman

Dean Foreman
Posted December 1, 2020

The year has brought extreme and at times contradictory information about the economy and our industry, making it increasingly difficult to determine whether the economic recovery has gained firm footing and ultimately traction, in which natural gas and oil will play a key role.

Importantly, we currently see well-grounded pillars for expected U.S. and global economic growth over the next two years – personal consumption expenditures and investment that generally represent the majority of GDP. These could kickstart new economic growth and prosperity that will not only require but fundamentally be enabled by oil and natural gas.

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Data Indicate Continuing U.S. Demand Recovery

monthly-stats-report  oil demand  economic recovery 

Dean Foreman

Dean Foreman
Posted November 19, 2020

While the International Energy Agency and OPEC recently lowered their expectations for global oil demand for this year and the next, the United States has continued to make measured progress, according to API’s latest primary data.

In October, U.S. petroleum markets reflected a U.S. economic recovery in progress. Demand increased broadly among fuels – diesel, jet fuel, other oils and gasoline among urban areas.

While these offer solid indications of domestic activity, international trade – particularly the pull for U.S. refined products – picked up in October. Moreover, the U.S. Energy Information Administration (EIA) projects record high U.S. exports of liquefied natural gas (LNG) in November.  

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Continued Progress Seen in Petroleum Demand

petroleum  demand  oil markets  growth 

Dean Foreman

Dean Foreman
Posted September 11, 2020

While oil markets remain concerned over the outlook for petroleum demand – see John Kemp’s piece arguing there’s lost momentum – a number of important indicators of transportation and industrial activity corroborate API’s primary data suggesting a more nuanced landscape while also supporting the view that genuine progress has recently been achieved.  

Since petroleum demand has remained a solid indicator of economic activity, the information has broad applicability to everyone who is concerned with what’s happening now.  And for those of us in the industry, accurate and timely data are essential to the flow of real activities and investment dollars.

From here it looks like oil markets have been relatively impatient, having anticipated a continued tightening as demand has recovered and supply declined. The challenge is managing expectations for the rate of recovery.

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Global Economic Recovery and Oil Markets in Context

economic recovery  oil markets  oil demand 

Dean Foreman

Dean Foreman
Posted August 26, 2020

The 2020 global economic recession, triggered by the COVID-19 pandemic and government responses to it, is the deepest since World War II. Yet the World Bank, along with the Bloomberg consensus, expect global GDP growth to rebound in 2021.   

It appears $15 trillion of global stimulus is likely to have a positive impact on economic growth – and, with enabling infrastructure, markets and policies, could become a source of optimism for global oil markets.  

Historically, global GDP growth and increased oil demand have gone together – once there’s impetus for growth there must be energy to fuel that growth.

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