Fitch: United Steelworkers Strike Could Pressure Gasoline as Driving Season Approaches
'With gas prices bottoming out and driving season around the corner, a prolonged strike could tighten up gasoline balances,' says Mark Sadeghian, Senior Director.
Gasoline consumption increased by 4.6% year over year in December and 6.4% in January, a sharp reversal of trends in previous years as substantially lower crude oil prices have led to lower pump prices. Increased demand came despite unfavorable regulatory pressures on U.S. fuel use, including the renewable fuels mandates, and CAFE (Corporate Average Fuel Economy) standards.
Fitch believes oversupply in the crude markets will gradually correct itself as industry capex cuts work their way through the energy chain. However in the near term, oversupply will pressure crude spreads and hinder some of the industry's windfall profits.
The full report, 'U.S. Refining Dashboard 2015,' is available at www.fitchratings.com.
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