API’s May Data Report Shows Signs of Industry Recovery
(P&GJ) – The gradual reopening of state economies drove a notable rebound in U.S. energy markets in the month of May with U.S. petroleum demand increasing 14% to 16.2 Mmbpd, according to data released Thursday from the American Petroleum Institute (API).
API’s May 2020 Monthly Statistical Report (MSR) and Q2 2020 Industry Outlook showed that motor gasoline accounted for more than 80% of the demand increase with monthly deliveries surging nearly 29% to 7.3 Mmbpd after reaching a multi-decade low in April.
Demand for distillate fuel and liquid feedstocks also notched monthly increases, while jet fuel posted its fifth consecutive monthly decline and reached its lowest level since 1967.
"The underlying market fundamentals still appear constructive and should position the U.S. natural gas and oil industry to play an important role in the recovery of the global economy," API Chief Economist Dean Foreman said. "The uptick in demand associated with the gradual reopening of state economies leads us to be cautiously optimistic that the worst may be behind us."
On the supply side, reduced drilling activity led to a 0.6 MMbpd decrease in U.S. crude oil production which averaged 11.4 Mmbpd in May.
U.S. natural gas liquids production held relatively steady at 4.8 Mmbpd, down 0.8% from the month prior.
These production decreases correspond with a record fall in U.S. drilling activity, which has declined 70% year to date in response to the unprecedented and abrupt decline in demand.
Read the full May 2020 Monthly Statistical Report here and the Q2 2020 Industry Outlook here.
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