WASHINGTON, Oct 1 (Reuters) - U.S. gasoline demand peaked in 2007 and will decline into the future as efficiency and the development of biofuels and high-tech cars like hybrids speed up, Exxon Mobil Corp’s (XOM.N) top executive said on Thursday.
“We think going forward that because of the emphasis on energy efficiency, ongoing improvements in vehicle miles standards and hybrid (cars), that motor vehicle gasoline demand is down, is headed down, and is going to continue to head down,” Rex Tillerson, Exxon chief executive, said at an Economic Club of Washington dinner.
Biofuels, including ethanol and biodiesel, will continue to chip away at demand in the world’s largest consumer of motor fuels, he said.
U.S. mandates require steady annual increases in the blending of biofuels into gasoline and will peak at 36 billion gallons of the alternative fuel by 2022.
U.S. oil products demand was about 20 million barrels a day in 2007 and should fall to about 17 million barrels by 2020, Tillerson said.
The falling demand means the United States, which has not built a new refinery from the ground up since 1973, will “likely not” need to build another one, he added.
Motor fuel demand is expected to keep growing in rapidly developing countries like China, where many people are acquiring their first gasoline-powered cars.
Tillerson reiterated that Exxon believed a carbon tax on fossil fuels would reduce greenhouse gas emissions better than a cap and trade market because it would be easier to administer and be less subject to gaming by speculators. U.S. Senators John Kerry and Barbara Boxer unveiled climate legislation on Wednesday that would kick off a cap and trade market by 2012, although the future of the bill is uncertain. (Reporting by Timothy Gardner; Editing by Peter Cooney)