Slide 16 of 30
Notes:
- Price volatility is closely tied to low inventories. As mentioned earlier, crude oil markets are at the root of our current low stock situation in both crude oil and product markets. During 1999, as crude supply fell below demand when OPEC cut back production, crude oil stocks fell and gasoline stocks followed.
- As of the latest weekly data, crude oil stocks are about 7% lower than the low end of the normal range for this time of year, and gasoline stocks are about 6% lower than the low end of the normal range.
- What is disturbing this year, is that inventories are beginning the season at about the same low levels as last year. Although we expect them to improve by the end of the summer, we are beginning the driving season with very little stock cushion.