Truck drivers: As of May 8th, 2020, when pandemic lockdowns were at their peak, 88,300 truck drivers had lost their jobs. Many others were furloughed or left underemployed, which resulted in shifting work into other fields. The impact of the pandemic on transport demand was particularly strong in the refined fuels industry, as road transportation ground to a halt. Gasoline demand has increased by 1.4 MM bpd since January 2021, causing increased demand for tanker transportation. As a result of this sudden increase in demand and reduced supply of drivers, there is currently a shortfall in transportation, which is causing most of the gas shortages throughout the country. Source: Operations Manager at a large fuel distributor.

Weather: In February, a deep freeze over Texas caused major refinery disruptions, which impacted supply throughout March and have only recently been relieved. Although wholesale margins were good (even great) during this time, many refiners, wholesalers and retailers feel like they lost the month of March playing catch up. Source: Wholesale Marketer at a Large U.S. Refiner

Volatility: The refined products rally that started in November and gathered pace after the winter storms came to a dramatic end on March 18th with ULSD (diesel) and RBOB (gasoline) falling 12 and 10 cents respectively. According to FreightWaves, this is the largest daily drop in 6 years. Volatility is expected to persist due to the combination of stagnating demand, excess refining capacity, regulatory uncertainty and the impact of COVID-19 on global fuel demand. As such, many refined products retailers are looking to leverage technology to help them extract the 2-5 cents of additional margin available between the bulk, wholesale and retail market. Source: VP of Fuel at a large c-store