April 16, 2008 / 2:33 PM / 12 years ago

Oil demand down 0.8 percent from year ago

WASHINGTON (Reuters) - U.S. demand for crude oil and petroleum products fell 0.8 percent in March from a year earlier, the American Petroleum Institute said on Wednesday.

A worker moves a crude palm oil tank in Petchaburi province, 123 km (76 miles) south of Bangkok on January 14, 2008. REUTERS/Sukree Sukplang

Total petroleum product deliveries, excluding exports, averaged 20.368 million barrels per day, down 161,000 bpd from March 2007, the API said in its monthly oil report.

Deliveries, which are a good indicator of demand, are calculated by the API to reflect petroleum products moved from refineries and bulk storage to wholesale and retail suppliers.

For the first quarter, U.S. oil demand fell 1.4 percent from a year earlier, marking the third quarter in a row with year-to-year declines in oil consumption, the API said.

Gasoline demand in March increased by 115,000 bpd, or 1.2 percent, to 9.284 million bpd, despite record pump prices.

API said gasoline use was higher due to several factors, including an early Easter and spring break for students, which resulted in more travel.

The trade group also said there were more ethanol-blended gasoline supplies in the market and that fuel has less energy content than traditional gasoline, requiring drivers to use more fuel to travel the same distance.

“Now our gasoline is getting less miles per gallon because there’s more ethanol being added to it,” said James Beck, API’s

senior economic analyst.

Deliveries of distillate fuel oil, including heating oil and diesel fuel, fell 148,000 bpd, or 3.4 percent, to 4.180 million bpd, the API said.

Jet fuel demand dropped 0.1 percent to 1.552 million bpd and residual fuel use declined 15 percent to 648,000 bpd.

On the supply side, March imports of crude oil averaged 9.574 million bpd, down 7.3 percent and the smallest volume since February 2007.

Petroleum product imports declined 21.4 percent to 2.786 million bpd, their lowest level since April 2004, the API said.

Imports accounted for 60.7 percent of domestic oil demand in March, down from 67.6 percent a year earlier.

U.S. crude oil production in March declined 2.2 percent to 5.106 million bpd.

Reporting by Tom Doggett; Editing by Walter Bagley

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