Gasoline Demand Drops From Three-Year High After Holiday

Gasoline demand in the U.S. fell from the highest level in almost three years following the Memorial Day holiday weekend.

Gasoline supplied to wholesalers, a proxy for demand, slid 2.2 percent, to 9.1 million barrels a day in the seven days ended May 30, the Energy Information Administration reported. Prices at the pump may decline through the end of June as demand slows, according to a forecast by AAA. Total fuel consumption decreased by 977,000 barrels a day, the biggest drop since December.

“It’s more of a seasonal drop,” said Phil Flynn, senior market analyst at the Price Futures Group in Chicago. “You usually see a decline in gasoline prices after the holiday.”

Gasoline futures for July delivery slipped 0.58 cent to $2.9429 a gallon at 12:19 p.m. on the New York Mercantile Exchange.

Regular gasoline at the pump averaged $3.663 a gallon nationwide yesterday, according to Heathrow, Florida-based AAA, the biggest U.S. motoring group. Prices will average $3.58 from Memorial Day to Labor Day on Sept. 1, according to an AAA forecast released before the holiday.

Over the past four weeks, demand rose to 9.2 million barrels a day, the highest since August and 5.4 percent above a year earlier. Consumption reached 9.31 million during the week ended May 23, the most since June 17, 2011.

“The four-week average is still strong and demand is still above 9 million barrels,” said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston.

To contact the reporter on this story: Moming Zhou in New York at mzhou29@bloomberg.net

To contact the editors responsible for this story: David Marino at dmarino4@bloomberg.net Richard Stubbe

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.