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.