Oil Industry Squeezed as US Demand Tanks

By Matt Cantor,  Newser Staff
Posted Apr 13, 2009 6:57 AM CDT
Oil Industry Squeezed as US Demand Tanks
A line of cars forms for gas Monday, Sept. 22, 2008, in Atlanta.    (AP Photo/Kate Brumback)

Big oil execs, analysts, and government sources say a century-old American tradition is waning: after years of increasing oil consumption, US guzzling has peaked, they believe. Last year, demand plunged 7.1% for gas, diesel, and jet fuel—the biggest drop since 1950, when dependable records began. And major changes for the oil industry mean big changes for government budgets and consumers alike, the Wall Street Journal reports.

An array of factors are behind the drop in demand: gas is being burned more efficiently,   Americans are buying hybrid cars, and biofuels are replacing gas. Meanwhile, government measures are pushing consumption “down, down, down,” says an analyst, and many consumers are driving less. Among the effects: refineries and gas stations are closing down, and with less money from the gas tax, government branches are struggling to maintain roads.
(More oil stories.)

Get the news faster.
Tap to install our app.
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.