U.S. 2012 oil demand down 2% vs 2011 - API
David Bird - Dow Jones Newswires
NEW YORK--The U.S. was plagued by persistently weak demand for refined petroleum products last year, while domestic crude oil production rose at a record rate.
New drilling techniques, which unlock crude from shale rock formations, continue to expand and providing a growing source of crude that was not even contemplated only years ago. However, sputtering economic expansion has kept a lid on oil use in 2012.
The U.S. appetite for petroleum products, which use crude as their principal feedstock, tumbled to its lowest annual level in 16 years, according to a study released by the trade group American Petroleum Institute. Consumption fell 2% in 2012 to an average of 18.566 million bpd last year.
"Demand was worse in 2012 than when the economy bottomed out in the  recession," API chief economist John Felmy said of the consumer caution during the current uncertain economic landscape.
Meanwhile, U.S. crude oil output jumped 13.8% to a 15-year high of 6.431 million bpd, the study said. Domestic production was up nearly 800,000 bpd, representing the largest annual increase in U.S. output since the beginning of commercial oil output in the nation in 1859.
Last year was "a story of contrasts. U.S. product demand weakened across the board, while domestic production of crude oil surged," Mr. Felmy said.
The trend also was reflected in last month's numbers: demand fell 2.1% in December, while output rose 15.6%.
The abundant U.S. production last year also slashed the need for imports of crude and petroleum products, which were down 6.9% to 10.517 million bpds, the lowest level since 1997, API said.
Refinery crude oil processing inched up by 0.3% in 2012 to an eight-year high of 15.342 million bpd. December crude oil runs were up 2.9% from a year earlier, at 15.783 million bpd.
Meanwhile, demand for major petroleum products such as gasoline, diesel fuel and heating oil declined year-on-year.
Gasoline, the most widely used petroleum product, registered a 0.4% drop for the full year, to 8.718 million bpd. December gasoline use slid 1.1% from the same time in 2011, to 8.683 million bpd.
Demand for distillate fuel, the umbrella grouping for diesel and heating oil, fell 4% for the full year and was down 7% year-on-year in December. Within the distillate figure, demand for ultra-low sulfur diesel fuel used by trucks and trains, fell 1.4% for the full year and dropped 3.2% in December from a year earlier.
Jet fuel use fell 1.7% in 2012 from 2011, but demand rose in December by 2.7% from a year earlier. Residual fuel, which is used in industrial boilers and power generation, but has been steadily losing ground to natural gas, fell 22.1% in 2012, to 359,000 bpd, the lowest level on record, API said.
Crude oil stocks ended 2012 at 359.8 million barrels, a 31-year high, and an 8.7% rise from a year earlier. Gasoline stocks were 0.2% higher year-on-year, at 223.7 million barrels, after rising 8.1% from the end of November.