U.S. Oil Demand Fell to 18-Year Low for January, API Says

[phantom power]

Demand destruction

U.S. January oil demand fell to the lowest level for the month in 18 years as a weak economy reduced consumption, the American Petroleum Institute reported.

Total petroleum deliveries, a measure of demand, dropped 1.7 percent from a year earlier to 18 million barrels a day, the industry-funded group said in a monthly report today. Total consumption fell 2 percent in 2012, the API said last month. The U.S. jobless rate increased to 7.9 percent from 7.8 percent in January.

“The January numbers reprise last year’s theme of weak demand,” John Felmy, chief economist at the API, said in the report. “This isn’t surprising given an economy that’s still treading water.”

January petroleum demand fell 2.4 percent from December, according to the API. Gasoline deliveries were 8.38 million barrels a day, up 2.4 percent from a year earlier and down 2.3 percent from December.

Use of distillate fuel, a category that includes heating oil and diesel, slid 6 percent from a year earlier to 3.6 million barrels a day. Demand for ultra-low-sulfur diesel, the type used by the trucking industry, fell 4.4 percent to 3.11 million.

http://www.bloomberg.com/news/2013-02-21/u-s-oil-demand-fell-to-18-year-low-for-january-api-says.html

[ffr]

1. ...as a weak economy reduced?

And/or price gouging by big oil yet again, with no explanation whatsoever for the rise in gasoline prices.

Shouldn't less demand, lower prices at the pump????

[appleannie1]

2. It has been a warmer than normal year which means less heating oil was needed. So why have gas

prices gone up?

[no_hypocrisy]

3. Guess that explains why it cost $3.179 per gallon in January.

So the rise in price these past few weeks is demand returning, not an inexplicable rise in prices.

[Jim__]

4. If I understand the article, gasoline deliveries were up from last January.

January petroleum demand fell 2.4 percent from December, according to the API. Gasoline deliveries were 8.38 million barrels a day, up 2.4 percent from a year earlier and down 2.3 percent from December.

Distillate fuel, which includes heating oil, was down 6% from a year earlier. I'm not sure that translates to a general decrease in the demand for oil across the whole economy. We need to know more about the demand for oil used for different purposes. Gross demand for oil fell; but if that is due for a drop in demand in a single category of use, the article may not be correct in blaming it on a general drop in the economy.

[Yo_Mama]

5. Fed policy

Inserting 85 billion a month into the US economy means that commodity prices will rise until the obvious becomes blindingly obvious.

[jpak]

6. Maine reduced its heating oil consumption by 45% over the last few years

Thanks to $4.00+ a gallon heating oil during the last gasp of the Bush regime.

People are buying and driving more fuel efficient automobiles too.

"Economic slowdown" had nothing to do with it.

yup