Demand For Gas Lags, Despite Lower Prices

Gasoline demand has dropped nearly 10% from a year ago, despite falling crude oil prices, Business Week reports. The ongoing credit crisis has prompted consumers and businesses to cut back on just about everything including gas consumption.

According to a recent weekly gasoline report by SpendingPulse for MasterCard Advisors, a division of MasterCard Worldwide, U.S. gasoline demand hit its lowest point since September 2005 for the week ending Oct. 3, a decline of 3.2 million barrels. Compared to the same week last year, demand was down 9.5%, the largest year-over-year decrease since September 2006.

The lower gasoline sales also account for temporary conditions such as damages caused by Hurricane Ike and temporary gas shortages in some parts of the South. Even though gasoline prices have fallen in recent months, it has not been enough to make a difference for consumers. Prices reached an all-time high of $4.11 per gallon on July 17, and slid 18%, to $3.48, by Oct. 7. ❖