API: US oil demand declined in August, first 8 months

US petroleum deliveries, a measure of demand, decreased by 4.3% in August from a year earlier to 18.6 million b/d, according to the latest monthly statistics from American Petroleum Institute.

This was the lowest August demand level in 15 years, and it contributed to 2.6% lower oil demand for the year to date, API said. Demand for gasoline, distillate, and jet fuel declined not only in August but also in this year’s first 8 months compared with the comparable period in 2011.

Motor gasoline demand, which averaged 8.893 million b/d in August, declined by 0.4% from a year earlier. At 1.44 million b/d, jet fuel demand in August was down 7.4% from a year earlier. Distillate demand, meanwhile, declined by 8.5% to average 3.67 million b/d.

API chief economist John Felmy cited weak employment and contraction in manufacturing in the US as likely contributing factors.

US refinery utilization climbed to 90.6% in August on a 2.5% decline in inputs to crude stills, but production of gasoline, distillate, residual fuel oil, and jet fuel, which declined from a year earlier, still outweighed demand. As a result, exports increased and imports decreased.

Though August crude oil production reached its lowest level so far this year at 6.049 million b/d as a result of Hurricane Isaac, production remained high, exceeding 6 million b/d for 10 straight months and was higher than during August 2011 by 7%, API reported.

With shut-ins of about 68% of natural gas production at the peak of Hurricane Isaac late in August, natural gas liquids (NGL) production, fell by 2.7% from July and averaged 2.3 million b/d in August. This was 3.8% above the year-ago levels. Year to date, NGL production was nearly 2.4 million b/d, up 8.9% over the same 2011 period.

US inventories of crude oil finished August at 358.8 million bbl, up 2.7% from a year earlier, while gasoline stocks were down 4.3% and distillate stocks were down 18.3% from a year earlier.

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