Petroleum products

U.S. petroleum products consumption
We forecast U.S. consumption of distillate fuel oil and jet fuel will increase in 2026 and 2027, and U.S. motor gasoline consumption will decrease over the same period. These forecasts are driven by assumptions of increased manufacturing and trucking activity for distillate fuel oil, increased air travel for jet fuel, and a more fuel-efficient vehicle fleet for motor gasoline.

We forecast U.S. consumption of total distillate fuel oil—often marketed as diesel, which includes petroleum-based distillate fuel oil, renewable diesel, and biodiesel—to increase by around 2% in both 2026 and 2027, reaching record highs in 2027. Our forecast increase in U.S. distillate consumption is driven by our outlook for growing GDP and industrial activity based on the S&P Global macroeconomic model. We expect economic growth to increase distillate fuel oil demand from manufacturers and truckers who ship goods.

Increased air travel, measured both as passenger volume and flight departures, has increased U.S. jet fuel consumption every year following the steep decline in 2020. However, commercial air travel in 2025 showed slower growth than the 2010‒2019 average and the slowest rate of growth in any year since 2020. We expect growth will continue in our forecast as commercial activity continues to increase. We forecast jet fuel consumption to increase in the United States by about 1% in both 2026 and 2027.

Consumption of motor gasoline is the only one of the three primary transportation fuels that we expect will decline over the next two years. Fuel efficiency gains in the vehicle fleet have generally outpaced growth in driving since 2019, allowing drivers to travel more miles using less gasoline. We forecast U.S. motor gasoline consumption to decline about 1% in 2026 as fuel efficiency gains surpass increased driving activity, measured by vehicle miles traveled. We forecast gasoline consumption to further decrease in 2027, although we expect a slowing pace of decline because of more growth in driving activity as employment growth improves. Compared with 2019, we forecast about 5% less U.S. motor gasoline consumption in 2026 and 2027, despite more miles driven in both years than in 2019.

Components of U.S. distillate consumption
We expect growth in distillate consumption will be supplied mostly by biomass-based diesel fuels. As a result, demand for petroleum-based distillate grows much less than total distillate demand overall. In our forecast, we assume biomass-based diesel production will resume growth following lower production and lower net imports in 2025.

Renewable diesel and biodiesel are biomass-based diesel fuels that can replace petroleum-based distillate and be used to comply with renewable volume obligations (RVOs) in the Renewable Fuel Standard (RFS) administered by the U.S. Environmental Protection Agency (EPA). Biomass-based diesel product supplied increases nearly 70,000 barrels per day (b/d) from 2025 to 2026 and another 40,000 b/d from 2026 to 2027. This growth is driven by our assumption that RVOs in the forecast years will increase, incentivizing biomass-based diesel plant utilization close to pre-2025 levels. We may adjust this assumption as the EPA releases more RVO guidance for 2026 and 2027.