US petroleum demand will remain behind 2019 levels through at least August 2021, EIA reports
In a sobering prediction for a market hit hard by COVID-19, the U.S. Energy Information Administration (EIA)’s July Short-Term Energy Outlook predicted that consumption of total petroleum and other liquid fuels will not cross average 2019 levels until August next year.
In April, the consumption of liquid fuels in the United States set a near-record, reaching the lowest monthly point since the early 1980s. This has started to turn around as states have relaxed restrictions, but levels fell in both March and April, and by the end of the latter month, consumption hit an average of 14.7 million barrels per day (b/d). Much of this was caused by reduced motor gasoline use — almost half, volumetrically speaking.
Against 2019 levels, motor gasoline consumption has fallen 1 million b/d so far. In the second half of the year, the EIA expects returns to employment will lead to increased gas use again but will remain about 2 percent less than its 2019 average in 2021.
It’s not all about road travel, though. Jet fuel consumption is likely to be about 31 percent lower than its 2019 average. In the second quarter of 2020, it fell approximately 660,000 b/d. While the EIA expects figures to rise to 1.4 million b/d in the fourth quarter, and reach 1.5 million b/d in 2021, that will still leave consumption down by about 12 percent over 2019’s average.
Both gasoline and distillate consumption also fell by 10 percent this year. While less affected than other areas, the slower economic growth still hit them hard. Travel restrictions were less of a factor therein, given their uses.
