Brief: Midwest Product Stocks Rapidly Deplete in April

Midwest (PADD 2) product stocks collapse after holding above 5YR seasonal range for first quarter of 2025

April 17, 2025 • Est. Reading Time: 4 minutes

Mobius Intel Brief:

Midwest refined product inventories have rapidly depleted in April after holding above the trailing five-year seasonal range for the first three months of 2025.

Key Intel

  • Early-2025 uncertainty about the Trump administration’s tariff threats on Canadian and Mexican goods pushed Midwest refiners to preemptively run facilities harder than normal during the first quarter of 2025. Refiners converted already-low crude inventories into usable refined products, pushing product stocks significantly above the trailing five-year seasonal range (shown below).

  • In the past three weeks, however, lower run rates and healthy product demand have rapidly erased this preemptive buffer against potential policy-driven disruptions.

  • Midwest refiners’ utilization rates fell from the top of the five-year seasonal range to an average of ~85% over the trailing three weeks, near the five-year seasonal mean and in line with rates observed at the same time last year.

  • Midwest distillate, gasoline, and kerosene-type jet stocks have dropped from five-year seasonal highs to the five-year seasonal mean this week.

  • PADD 2 distillates fell 896 kb, 1.9 MMb, and 995 kb over the trailing three weeks versus +244 kb, -614 kb, and +837 kb during the same period last year. Similarly, PADD 2 gasoline inventories fell for each of the past five weeks for a total change of -5.58 MMb versus -1.91 MMb over the same five weeks last year.

Takeaways

  • While the Trump administration’s tariffs on Canadian and Mexican goods do not apply to USMCA-compliant imports of crude and other energies, the rapid collapse in PADD 2 product inventories alongside crude inventory levels at the bottom of the five-year seasonal range warrant monitoring.

This commentary contains our views and opinions and is based on information from sources we believe are reliable. This commentary is for informational purposes, should not be considered investment advice, and is not intended as an offer or solicitation with respect to the purchase and sale of commodity interests or to serve as the basis for one to decide to execute derivatives or other transactions. This commentary is exclusively intended for Mobius clients and is not considered promotional material.