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November petroleum demand continues weakness (includes monthly statistical report)

WASHINGTON, December 21, 2012 – Total U.S. petroleum deliveries (a measure of demand) were down 3.3 percent from November a year ago to 18.5 million barrels per day and decreased slightly (0.2 percent) from October 2012. Demand was at its lowest November level in 17 years and marked the tenth monthly year-over-year decrease (every month except May) for the 11 months so far in 2012.

Gasoline and distillate demand also declined in November versus a year ago, with gasoline demand slipping 0.3 percent and distillate demand falling 6.3 percent. Year-to-date gasoline deliveries reached their lowest level since 2001. Demand for jet fuel, residual fuel oil, and other oils also declined from November a year ago.

“The economy has shown modest improvement, in employment for example, but the fundamentals of fuel demand fail to indicate a strengthening recovery is imminent,” said API Chief Economist John Felmy. “Look at the weakness in distillate deliveries, including ultra low sulfur diesel, which is critical to shipping just about everything in our economy. It was down 4.5 percent from November last year.”

Inputs to crude distillation units fell very slightly from October and were down 2.2 percent from November 2011 to 15.1 million barrels per day – the lowest volume since April. Gasoline production fell from the prior month, the prior year, and the prior year to date (by 2.3 percent). Gasoline production has posted year over year declines 15 out of 17 months since July 2011. Yet, even at these lower levels, gasoline production year to date was the third highest on record.

Because production of distillates and residual fuels as well as production of gasoline was higher than demand, product was exported. For all months in 2012, refined product imports continued to be below the export levels. In November, total imports of crude and refined products fell by 10.0 percent from last year to average just above 10.0 million barrels per day (with refined product imports accounting for almost 1.9 million barrels per day of the total).

The refinery utilization rate in November was 86.8 percent, 0.1 percentage points lower than the prior month and 0.2 percentage points below last year. Refinery operable capacity was 17.381 million barrels per day in October (the most recent update).

Domestic crude oil production continued to grow, up 2.0 percent from October 2012 and up 13.3 percent from November a year ago. At nearly 6.8 million barrels per day, it was the highest volume for the year and highest volume in nearly 18 years, since February 1995.

The number of oil and gas rigs decreased from 1,834 in October to 1,809 in November, according to the latest reports from Baker-Hughes, Inc., and has stayed below 2,000 every month in 2012.

Crude oil stocks were up 10.2 percent from November a year ago and up 0.1 percent from October 2012 to end November at 372.1 million barrels. Stocks of all major products were down from last year’s levels. Gasoline stocks were down 5.4 percent in November from a year ago but up 3.6 percent from the month before.

API is a national trade association that represents all segments of America’s technology-driven oil and natural gas industry. Its more than 500 members – including large integrated companies, exploration and production, refining, marketing, pipeline, and marine businesses, and service and supply firms – provide most of the nation’s energy. The industry also supports 9.2 million U.S. jobs and 7.7 percent of the U.S. economy, delivers $86 million a day in revenue to our government, and, since 2000, has invested over $2 trillion in U.S. capital projects to advance all forms of energy, including alternatives.

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