US oil, fuel demand falls amid weak economy - API

US petroleum demand fell 2.6% in the first six months of 2012 compared with the same period a year ago and dropped 3.0% in June from June 2011, according to the latest monthly figures from the American Petroleum Institute (API) trade group.

Gasoline demand tracked the overall numbers, declining 2.5% for June versus a year ago and 1.0% for the first six months of this year against the same period in 2011, the API said.

Distillates, jet fuel, and residual fuel were also down for the first six months, while distillates and residual fuel were down for June.

Jet fuel demand in June rose 0.7% over June a year ago.

“A weakening economy requires less fuel, and this by most measures is a weakening economy,” said API chief economist John Felmy.

“The fall in demand in June is particularly notable and consistent with other disappointing metrics in the economy, including falling retail sales and contraction in the manufacturing sector.”

Supplies of refined products were ample. US refinery production in June was up for the major products, excluding gasoline, which was down for the second month in a row.

Total refinery inputs for June were up 2.8% to nearly 15.8 million bpd, the highest level so far this year, the API said.

Because of weak demand, exports of refined products in June increased by 17.8%. Year-to-date exports were up by 14.2%.

For the first time since July 2011, refinery utilization rose above 90.0% for the month. At 91%, utilization in June was up 5.1 percentage points from last month.

Total imports of crude and refined products fell in June by 6.0% to average 10.9 million bpd, according to the API. For the first half of the year, they declined by 6.9% compared with the same period a year ago.

Refined product imports were below export levels through the first half of the year. Canadian crude imports made up nearly 25% of total crude oil imports for the month.

Domestic crude oil production in June rose by 1.2% from May and 10.7% from June a year ago to average almost 6.2 million bpd, the highest June level since June 1998.

For the ninth month in a row, monthly US crude oil production exceeded production in the same month one year ago, the APi said.

At the end of June, crude oil stocks at 382.4 million bbl were up 6.7% from last year and down 0.4% from May levels. June gasoline stocks were down 4.0% from a year ago but up 0.6% from month ago levels.

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