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Reader David sent in a link to an alarming looking chart of gasoline sales on the EIA's website U.S. Total Gasoline Retail Sales by Refiners (Thousand Gallons per Day)
David notes a stunning plunge from 41,972,600 to 28,433,900 (-31%) in the last four months.
I asked Tim Wallace what to make of this. Wallace writes ...
Hello MishCorrectly Depicting the Plunge
I queried the EIA and as I expected the key to understanding the chart is the statement the chart shows retail sales by refiners. I have been closely following the divestiture of the retail outlets by the majors such as Exxon and BP over the past couple of years, accelerating now because there is NO MONEY in retail, just in exploration and distribution - basically through the wholesale level.
Therefore the sales by the refiners at the retail level is of course rapidly plummeting.
It's an interesting measure which has no validity whatsoever on total usage/demand.
Gasoline sales have indeed plunged in a shocking manner, just not as shocking as it appears in the above chart.
Please consider my April 6 post Another Plunge in 3-Month Rolling Average of Petroleum and Gasoline Usage for Jan, Feb, March 2012
The above chart shows total petroleum and gasoline usage for Jan-Feb-March 2012 usage vs. the same three months in prior years. That method is the correct way of understanding gasoline usage.
Mike "Mish" Shedlock
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