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Friday, February 17, 2012 - 10:00

US API Text: Consumer Gasoline Demand Remains Weak


WASHINGTON (MNI) - The following text is the summary of the American Petroleum Institute's monthly report on domestic petroleum deliveries, gasoline deliveries and crude oil production for January released Friday:

PETROLEUM DELIVERIES

In January, total domestic petroleum deliveries, a measure of U.S. petroleum demand, dropped 5.7 percent compared with the same month in 2011, with declines in deliveries of all the major refined products. Gasoline deliveries, a measure of consumer demand, slipped 0.2 percent to 8.4 million barrels per day, a nine-year low for the month of January. Despite the improved employment situation in January, as reported by The Conference Board, consumer demand for gasoline has been weak since the 2007-highs, possibly due to the increase in fuel-efficient cars on the road, higher gasoline prices and the demographic changes in the driving-age population.

Deliveries of distillate fuel, which include both diesel and heating oil, fell by 1.4 percent to 3.9 million barrels per day. Ultra-low sulfur diesel deliveries showed strong growth of 4.7 percent from last year but the high-sulfur type was down by nearly 27 percent from last year due to the relatively warm winter in January. With the exception of January 2007, distillate fuel deliveries were at a 12-year low for the month. Jet fuel deliveries were down 0.2 percent and residual fuel deliveries were down nearly 50 percent from January 2011 levels. The "other oils" share of the domestic market shrank by 12.3 percent from last year. Petroleum exports fell from the recent highs of 2011 to average just over three million barrels per day and were higher than last year's levels by 13.5 percent.

PETROLEUM SUPPLY

Domestic crude oil production rose by 3.8 percent to average 5.7 million barrels per day in January. This level was at an eight-year high for the month. Alaskan production was up by 34 percent from last January, at 624 thousand barrels per day. North Dakota, the center of recently discovered tight-oil formations, produced near-record levels of crude oil for the State at 470 thousand barrels per day. The number of oil and gas rig counts remained flat from December 2011 levels, according to the latest reports from Baker-Hughes Inc. Imports of crude oil and refined products fell in January by 14 percent to average 10.1 million barrels per day as increased domestic production offset the lower import levels. Canadian crude imports dropped by 2.8 percent in January to average 2.1 million barrels per day. Crude oil imports fell to a 12-year low with the exception of January 2010 and refined product imports fell to a 17-year low for the month of January.

Despite the recent announcements on declines in refinery capacity due to closures in the Northeast region, January's total refinery inputs were higher than last year's levels by 1.9 percent. With the exception of residual fuel production, industry production of key refined products remained higher than the prior year levels. Gasoline production at 8.9 million barrels per day was at a record-high for the month of January. Distillate fuel production at 4.6 million barrels per day was at a record-high for any January. Utilization rates were up by 0.9 percent in January this year compared with last year.

In January, crude oil stocks were down 3.2 percent from last year but slightly up from December 2011 levels. At 336.2 million barrels, crude oil stocks were at a four-year low for January. Gasoline stocks were up from month-ago and year-ago levels. At 227.6 million barrels, gasoline stocks were at a three-year high for January. Distillate fuel inventories were down from month-ago and year-ago levels and reached three-year lows in January, at 144.1 million barrels. Jet fuel stocks were at a six-year high for the month, with the exception of January 2010. Stocks of "other oils" grew by 41.3 percent primarily driven by the increased production of propane/propylene mix and the reduced demand for heating oil products. Total inventories of all oils were up from last year by 1.7 percent but down from December 2011 levels by 1.1 percent.

** Market News International Washington Bureau: 202-371-2121 **

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