US gasoline demand rose 1.0% from a year earlier in March and exceeded weekly estimates for a 21st consecutive month, while distillate demand growth slowed sharply, TPH Energy said in a Monday note.
Gasoline consumption improved from a 1.1% year-over-year decline in February, lifting the first-quarter average to a 0.9% decline compared with a 1.2% decline in the fourth quarter, according to TPH.
Despite strengthening gasoline demand, vehicle miles traveled growth slowed to 1.6% in March from 2.6% in February, while average pump prices increased by 73 cents per gallon from the prior month.
Regional gasoline demand increased across most markets, with PADD 1 up 4.2%, PADD 2 up 0.2%, PADD 3 up 0.3%, and PADD 4 up 1.3%, while PADD 5 declined 3.8%, TPH said.
Weekly Department of Energy data points to gasoline demand growth easing to 0.7% in April before falling 1.5% in May, according to the note.
Distillate demand growth slowed to 0.3% in March from 5.4% in February, missing weekly estimates by 118,000 barrels per day and ending a six-month streak of results above expectations, TPH said.
Strength in PADD 1 at 6.5%, PADD 2 at 0.4%, and PADD 4 at 15.1% offset declines of 3.9% in PADD 3 and 17.9% in PADD 5, while April and May demand are projected to decline 0.2% and 4.2%, respectively.
Total US petroleum product consumption increased 2.2% year over year in March, slowing from 4.5% growth in February as weaker distillate and propane-propylene demand weighed on results, TPH said.
Overall product demand missed weekly estimates by 511,000 b/d as declines in distillate and propane-propylene more than offset modest gains in gasoline, jet fuel, and residual fuel oil demand.
US gasoline exports fell to 915,000 b/d in March, down 73,000 b/d from February and 14,000 b/d from a year earlier, according to TPH.
Lower shipments to South and Central America drove the monthly decline, while reduced exports to Mexico accounted for the year-over-year weakness.
Gasoline exports represented 10% of production in March versus 11% in February, according to the note.
Although March gasoline exports exceeded weekly indications of 882,000 b/d, TPH expects volumes to ease to 864,000 b/d in April before recovering to 889,000 b/d in May.
Distillate exports climbed to 1.34 million b/d in March, increasing 200,000 b/d from February and 235,000 b/d from a year earlier as stronger shipments to Europe, Asia, Africa, and Canada offset weakness elsewhere.
After beating the weekly average of 1.27 million b/d in March, distillate exports are projected to rise to 1.65 million b/d in April before easing to 1.58 million b/d in May, TPH said.