May 16, 2007
Does the US have enough gas?
US crude oil and petrol (gasoline) stocks rose more than expected last week, according to the latest weekly figures from the US Energy Information Administration. At R-Squared Energy blog, Robert Rapier suggests the increase may not be enough to prevent the US going into Memorial Day with record low inventory levels. As Adam Robinson of Lehman brothers put it in his note released immediately after the figures: "gasoline finally builds east of the Rockies, but stubborn demand limits stock increase." The EIA’s conclusion: "With gasoline inventories likely to remain low all summer, retail prices are expected to remain close to $3 per gallon during the entire summer season. Prices could rise again towards the end of summer if demand surges, as it often does, in late July and August." And if there is any further disruption to supplies, prices could go higher still.
UPDATE: For a characteristically hard-hitting view of what the summer might hold for US drivers, check out Matthew Simmons, author of "Twilight in the Desert", here.
