In October, U.S. waterborne gasoline imports fell to their lowest levels since the COVID-19 pandemic, driven by a sharp decline in shipments from Europe and a significant drop in Asian cargoes. According to traders and ship-tracking data, gasoline imports totaled 335,000 barrels per day (bpd), marking a 37% decrease year-on-year and the lowest since April 2020.
European shipments to the U.S. Northeast reached a record low of 137,000 bpd, while Asian imports plummeted 74% from September to just 21,000 bpd, less than half of last year’s average. The declining import levels are indicative of weak demand and high domestic production, which could further impact global oil prices and refiners’ profits.
Crude prices remain near three-year lows, largely due to subdued demand from China, the world’s second-largest gasoline consumer. As a result, refiners globally are experiencing profits at multi-year lows, exacerbated by slowing economic growth and the increasing prevalence of electric vehicles.
Kpler’s data indicates that U.S. gasoline imports for November are tracking slightly higher at 365,000 bpd. However, analysts warn that November could see even lower levels of imports, particularly from Europe, as refining margins in the region remain weak. Benchmark Northwest European gasoline profit margins fell below $6 a barrel, the lowest seen in seven weeks.
As European refiners produce less gasoline due to low profit margins and seasonal maintenance, the potential for increased supply post-maintenance could make it profitable to resume shipments to the U.S. if prices decline.
Low gasoline stocks on the U.S. East Coast may eventually spur higher imports, with current levels standing at 51.8 million barrels, which is 6% below the five-year average. Total U.S. gasoline stocks also reflected a decline, sitting at 208.9 million barrels, 4% below the five-year average.
In Asia, refiners have focused on regional sales, bolstered by refinery issues in the Middle East and Southeast Asia. Strong demand from countries like Vietnam, Malaysia, and Indonesia has also contributed to regional gasoline refining margins improving by approximately 40 cents per barrel month-over-month.
Increased gasoline shipments within the U.S. have reduced the need for international cargoes. Gulf Coast refiners, operating at higher-than-normal rates, have been able to supply excess gasoline, leading to the highest waterborne shipments from the Gulf Coast to East Coast markets since 2019.