US oil demand fell by 98 thousand b/d to 20.26 mb/d in May, a 0.19 mb/d upward revision from the weekly EIA estimate. We had expected no change to the weekly data. Demand for the four main products fell by 0.42 mb/d y/y, led by diesel (-0.23 mb/d y/y), even though distillate demand was revised higher by 0.14 mb/d versus the weekly figures.
Total US gasoline demand fell by 0.15 mb/d y/y to 9.4 mb/d in May even though US vehicle miles travelled (VMT) increased by 1.0% y/y. However, gasoline demand in PADD 1 increased by 0.15 mb/d y/y to 3.5 mb/d, and VMTs in the Northeast and South Atlantic regions increased by 0.8% y/y and 3.2% y/y respectively. PADD 2 gasoline demand and VMT fell by 0.25 mb/d y/y and 0.3% y/y respectively as flooding impacted Midcon residents’ ability to drive.
US distillate demand fell by 0.23 mb/d y/y to 4 mb/d in May, as the Freight Transportation Service Index (TSI) fell by 0.7% m/m and by 0.2% y/y. The Freight TSI has now fallen m/m in four of the last six months, and freight shipments on railways and trucks were down y/y in H1 19. PADD 2 distillate demand fell by 0.11 b/d y/y to 1.26 mb/d as flooding in the Midwest brought corn planting to a virtual standstill.
US crude throughputs were 0.27 mb/d lower y/y at 16.72 mb/d (+0.38 mb/d m/m) in May, as utilisation rates decreased by 2.7 ppts y/y to 90.6%. Offline CDU capacity increased by 16 thousand b/d y/y to 1.17 mb/d, leaving US operable capacity at 18.40 mb/d in May.
US crude exports rose in May by 58 thousand b/d m/m to 2.90 mb/d. US CDU outages remained high at 1.17 mb/d. Exports to Asia Pacific led the growth, as shipments rose by 0.12 mb/d m/m to 1.29 mb/d. Flows to China increased by 0.18 mb/d m/m in May after a broadly empty schedule in April. Flows to Latin America rose by 55 thousand b/d m/m, led by Chile (+77 thousand b/d), while exports to Canada fell by 0.13 mb/d from a high base.