Petroleum Product Wholesalers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 1,800 petroleum product wholesalers in the US act as middlemen between refiners/storage terminals and retailers or end users. Major revenue categories include motor gasoline; distillate fuel oil; lubricating oil and greases; jet fuel, naphtha, or kerosene; and residual fuel oil. Wholesalers may have downstream operations and own groups of gas stations. Petroleum product wholesalers service a wide range of customer industries, including gas stations, convenience stores with gas stations, airports, farms, and government fleet operators.
Clean Energy Transition
Consumer and governmental efforts to reduce US dependence on fossil fuels affect demand for petroleum products.
Sensitivity To Economic Conditions
Demand for fuel is sensitive to economic conditions and can drop during periods of uncertainty.
Industry size & Structure
The average petroleum product wholesaler operates out of a single location, employs 18 workers, and generates about $320 million annually.
- The petroleum product wholesaling industry consists of about 1,800 firms that employ about 32,000 workers and generate $575 billion annually.
- The industry is concentrated; the top 50 firms account for 87% of industry revenue.
- Large companies, such as Mansfield Energy, Murphy Oil, and US Venture, may have additional midstream and downstream operations, in addition to wholesale operations.
- Petroleum products wholesalers ("jobbers") supply the majority of fuel sold to gasoline stations. Jobbers also own or act as franchisors for the majority of gas retail outlets in the US.
- Most firms operate within a limited geographical market, and may be constrained by proximity to supply (terminals).
Industry Forecast
Petroleum Product Wholesalers Industry Growth
Recent Developments
Oct 23, 2024 - Refining Capacity Increasing
- According to the EIA’s 2024 Refinery Capacity Report, which measures changes in US refining capacity in effect as of January 1, 2024, US refining capacity increased for the second time since the pandemic. US operable atmospheric crude oil distillation capacity, the primary measure of refinery capacity, totaled 18.4 million barrels per calendar day (b/cd) at the start of 2024, up 2% from the start of 2023. The three largest US refiners — Marathon, Valero, and ExxonMobil — all reported increases in refining capacity at the start of 2024 compared with 2023. Additions to capacity over the past decade reflect expansions to existing facilities, reactivation of previously decommissioned units, or the addition of relatively small facilities. Notable additions include ExxonMobil’s completion of a major refinery capacity addition in Beaumont, Texas, in March 2023, boosting the facility’s total crude oil distillation capacity from 369,000 b/cd to 609,000 b/cd.
- Producer prices for petroleum and petroleum products merchant wholesalers declined by 6.2% in July compared to a year ago after rising 5.6% in the previous July-versus-July annual comparison, according to the latest US Bureau of Labor Statistics data. Employment by the industry fell 1.4% year over year in July, while average wages at petroleum product wholesalers rose 2.2% over the same period to $31.03 per hour, BLS data show. Wholesale prices for petroleum products have fallen along with the price of crude oil. While crude oil prices have fallen recently, the EIA expects the price will rise in the second half of 2024.
- Growth in air travel is driving demand for jet fuel. The US Energy Information Administration’s (EIA) August Short-Term Energy Outlook forecasts a 3% rise in US jet fuel consumption in 2024 compared with 2023 and growth of another 3% in 2025. Per the EIA forecast, US jet fuel consumption will exceed 2019’s pre-pandemic level next year. The agency expects that relatively strong jet fuel consumption will cause jet fuel prices to rise more than prices for other fuels in 2025. US airlines were predicted to carry 271 million passengers worldwide from June 1 to August 31, according to industry trade organization Airlines for America, representing a 6.3% increase from last summer and a new record for US airlines.
- The Energy Marketers of America (EMA) and American Fuel & Petrochemical Manufacturers, among others, are suing the EPA over its March final rule, which, according to the trade association, “imposes an electrification mandate on the US heavy trucking sector.” The new rule is expected to drive the production of trucks fueled by electricity and hydrogen and aims to reduce greenhouse gas (GHG) emissions by up to 60% by 2032 for some vehicle classes. The lawsuit follows a challenge to EPA’s light- and medium-duty vehicle emissions standards for model years 2027-2032. The EMA has asked the courts to review EPA’s prior tailpipe emissions standards for model year 2025 and 2026 vehicles and the Agency’s reinstatement of California’s Clean Air Act waiver to issue climate-based vehicle emissions standards. According to the EMA, the Biden administration’s attempts to electrify transportation threaten the viability and jobs of small business energy marketers.
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