BAKU, Azerbaijan, May 12. Gasoline production will see only small growth in 2023, BMI – A Fitch Solutions Company, said, Trend reports.
BMI says in its report that gasoline production will grow over the short-to-medium term on the back of new refining capacity additions which are expected to double down on higher-quality fuels including gasoline.
“We currently see global motor gasoline output expanding by 0.7% y-o-y in 2023 equal to net 1.6mn b/d of new capacity with 12 countries seeing new capacity coming online and three countries (New Zealand, South Africa and Japan) are set to close some of operating capacity. We highlight Nigeria’s Dangote, Oman’s Duqm, Kuwait Al-Zour which are the largest facilities expected to become operational in 2023,” reads the report.
BMI experts note that the US has also added refining capacity as ExxonMobil started operations of Beaumont refinery expansion project in mid-March 2023.
“At the same time, there are some planned closures which leaves the US with estimated net 114,000b/d of new refining capacity in 2023. However, weaker demand for gasoline in the US will limit growth in US domestic production of this fuel to 0.3% y-o-y growth in 2023 as producers are expected to prevent crack spread declines.
Low levels of gasoline inventories in the US remain a key bullish factor for RBOB NYMEX gasoline prices in 2023. We expect US gasoline stockpiles to remain low throughout 2023. We could see some improvement on the back of weakened gasoline demand over Q2-Q323 however the growth in domestic production is expected to remain small, limiting the upside,” says the report.