NEW YORK (Reuters) - U.S. gasoline demand fell year-over-year for the third consecutive month in March, according to federal data released Thursday, putting the country on track for its first year-over-year decline since 2012.
Analysts and refiners have blamed the weakness on a host of issues, from poor weather to record 2016 demand figures that created a hard-to-top baseline.
The modest drop in U.S. gasoline demand was offset by strong demand for distillates, helping push total oil demand up by 2.1 percent in March versus last year, according to EIA’s Petroleum Supply Monthly report.
U.S. gasoline demand fell by 0.5 percent to 9.353 million barrels per day in March versus last year, EIA data shows. Demand fell by 1.9 percent in January and 2.4 percent in February.
“Given the slowness in the first quarter, it makes it likely that we will see year-over-year declines,” said Robert Campbell, head of oil products markets at consultancy Energy Aspects.
Demand in early 2016 was strong, driven in part by gasoline prices that fell below $2 a gallon for the first time since 2009, Campbell said.
Many analysts still expect gasoline demand to rise modestly from last year’s record levels, but stubbornly high inventories are expected to weigh on refining margins.
U.S. gasoline demand, which accounts for 10 percent of global consumption, has risen each year since 2012.
U.S. distillate demand was up 5.4 percent to 4.15 million bpd in March compared with last year, EIA data showed.
The weak U.S. gasoline is at odds with driving volumes, which are on pace for another record year, federal data shows, suggesting stronger fuel efficiency standards are starting to take hold.
Motorists logged 272 billion miles (438 billion km) on U.S. roads and highways in March, a 0.8 percent increase year-on-year, according to the latest data released on Tuesday by the U.S. Department of Transportation.
U.S. vehicle miles traveled were up 1.5 percent year-over-year through the first three months of 2017.
Reporting by Jarrett Renshaw; Editing by Lisa Shumaker and Richard Chang