U.S. oil demand at five-year low, API report shows

Bill Bush | 202.682.8069| bushw@api.org

WASHINGTON –  For the first seven months of 2008, U.S. oil demand declined to a five-year low compared with the same period in previous years, API said today in its Monthly Statistical Report. For the January-through-July period, total petroleum deliveries (a measure of demand) fell 3.6 percent from a year ago while gasoline deliveries declined more than 2 percent.

“The weaker demand observed for the first six months of the year continued in July,” said API statistics manager Ron Planting.  “Changes in consumer behavior have essentially erased five years of growth in gasoline demand.” 

For the month of July, the U.S. produced about 5.1 million barrels per day of crude oil while importing some 13.5 million barrels per day of crude oil and products.  Total imports were down 3.9 percent for the year through July compared with the same period in 2007.  “With less demand, we’re importing less oil,” said Planting.  “However, imports still represent the lion’s share of U.S. consumption.  Canada is the largest of our diverse suppliers, providing us nearly as much oil as the total from all of the Persian Gulf nations.” 

Product imports were down steeply in both July and for the first seven months of 2008, compared with 2007.  Crude oil imports, meanwhile, were down only slightly for the first-seven-months period and up 7.4 percent for July.      

For July, compared with a year ago, U.S. crude oil production was up 2.1 percent.  Driven by record levels of lower-48 production (the highest since 2004), the July increase helped bring first-seven-months U.S. production levels to within one-half percent what they were over the same period in 2007.  Oil production in the lower-48 states drove the July increase; Alaskan production declined.    

For the year through July, total inputs to crude distillation (an overall measure of refinery activity) were less than 1 percent lower than the same period last year and down 1.6 percent from July 2007.  However, because of steady expansion and upgrading of refinery capacity, industry production of the four major products (gasoline, distillate, resid, and kerosene jet fuel) reached a record level for July of 16 million barrels per day – reflecting an especially strong rise in distillate production.