Low Stocks Mean Tight Markets

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• Similar to the EIA base case projections for OECD petroleum stocks, U.S. stock projections are expected to remain low through the rest of this year.

• This chart shows two important components of U.S. stocks, crude oil and gasoline. While stocks are currently low, they did improve somewhat in March and April.
  • Crude oil inventories are still below normal levels.
  • Gasoline stocks at the end of February had dropped about 5 percent below the low end of the normal range. Gasoline inventories are now at the low end of the normal band.

• The U.S. inventory data, which are accurate and timely, will be an important price barometer to watch. Low inventories leave little cushion to absorb unexpected events such as refinery or logistical disruptions.