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GasBuddy.com Senior Petroleum Analyst Patrick Dehaan on the potential factors leading to the declining demand for gas.
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So drivers hoping for some relief at the pump think again after months on the declined -- is there are up four cents this past month.
But while pump prices rise MasterCard says US gas demand has dropped to its lowest level since they began tracking drivers consumption.
And 2004.
Joining announced after -- Honda's senior petroleum analyst -- gas buddy dot com my gas buddy.
-- -- they become an odd because.
Settled as -- argue that a lot of people lately.
Because we see gas demand really dropping off I mean its lowest level since 2004.
And -- say it's because all were all driving fuel efficient cars -- true.
What it will -- what do you what do you think it has its I think there's a bit of everything certainly.
Fuel efficient Karzai help the situation now we we get accounts and updates from University of Michigan.
They do a study that tracks the average fuel efficiency of of new cars that Americans are buying and it's gone up virtually every month.
Believe twenties the last year 2012 we averaged 23 point nine miles -- -- for the year.
That was a big jump up back when they started their study in 2007 the average fuel economy of new car was back down to 21 -- Two miles a gallon improvement over last stop five years that's pretty -- See I just because 22 point three million people are either unemployed -- aren't working as much as they want to listen they just have so much less money in -- pocket and it you know it you know on the job in Germany where ago you know I mean I think they're just.
People don't have money so they're driving -- -- Well let me try to poke a hole -- that.
2008 when bears and Stearns collapsed.
You'll remember that prices fell instantaneously overnight gas prices were down people's you know unemployment numbers started going way up.
But still MasterCard was tracking demand during that time -- -- note that as you pointed out.
This is the time that they've noted in the -- is at its lowest times and -- started so.
-- -- -- -- Really all right -- -- you my friend there because and a big gas prices fell I mean remember it was a dollar 89 a gallon.
So all the sudden gas became weigh more at portable.
I mean last Thanksgiving we -- and they're out they're saying prices at the pump when you're going to grandma's house of the highest they have ever been at Thanksgiving so if prices are really high in you don't have a job you're gonna drive less it's it's.
You nobody has a job Bear Stearns collapse your target -- doesn't mean.
Employment falls but gas prices are low at least you can still afford to drive.
Glad I suppose that's true I like is that it's not just one thing it's not just the other you're you're certainly -- part of it.
Is because unemployment does still remain higher than where was pre recession so obviously you don't have a job you're not gonna be driving around as much.
Part of its high prices as well -- you cited the fact that Thanksgiving prices still -- through the roof.
People have made permanent.
Lifestyle changes and they're consuming lots of the stuff not -- that.
And they're driving more fuel efficient vehicle Prius sales that topped a million and that's that's great another -- -- right.
They -- so what do you think happens going forward is there a danger to lower gasoline demand I mean are we gonna see refineries doing lasted drillers drilling last we have this whole.
Revolution that you know where shales creating so much more oil here in the US -- demand goes down then do we back off on the drilling in the production and then -- experts is going to hire.
Well depends oil prices are pretty -- right now thanks to North Dakota and Canadian cruel and it's still favorable for refineries to refine even -- gas prices are slumping so.
As long as the economics are there for refineries to continue refining as much as possible as long as margins are healthy of refining level.
-- still kick out gas travel solid -- gasoline and that will help.
Usher in lower prices as well so -- really depends on the price of oil.
-- -- -- I mean that freezing in the next point it if demand is lower why are we seeing gas prices so high right now.
-- lot of it is the fact that the oil also has to be refined begin our gas tanks and refineries at least.
Late last year were still -- still slow production now that kind of boosted it up we've seen a big jump in gasoline inventories.
Which is probably why the national average stop dead in its tracks after Christmas.
Started rising now it's lot -- -- because gasoline inventories are beginning to rise significantly.
As long as that continues.
-- -- you're the best give an answer for everything real quick look car do you drive.
I drive a Mazda three and a good deal fish or.
Well it it does pretty well but a lot of time quite frank climate Chicago's I'd take mass trans Diego -- -- pageant hot here the best things coming -- thank you don't -- --
