FAKE US RECOVERY: More fuel for Slog’s argument

Further to yesterday’s Slogpost about the chimera of American growth, I am indebted to an Asia-based Slogger for this massively helpful addition to an understanding of Obamacon:

‘Any time I hear anybody burbling about a US recovery, I ask them to explain this graph:

 
 
It shows daily petrol sales in the US by refiners, 1983 to date. Sales are down by nearly a half since 2008. All the QE, all the bailouts, the tax rebates, cash for clunkers, low interest rates — all have failed, according to this simple and direct measurement of health.

It’s a fascinating chart, and it’s even worse if you factor in population. I did two minutes’ due diligence on Google and was surprised to learn that the population has increased by 34 per cent since 1983, from 234 million to 313 million. The 313m are buying far less fuel than did the 234m. Not just less per person, but less in total. Less than 30 million gallons a day today, compared to just over 50 million then. And then it was pretty consistent around 60 million a day for 20 years, until 2006-07.

 
And in the table below the graph, look at that astonishing drop in October 2011, to 32m gallons from 42 in September. Whoosh! It has since continued to drop and has been below 30m every month this year so far, with January 2012, at 28.4m, the lowest monthly total to be seen anywhere in the whole 29-year table.

Unless the US has started importing 20 or 30 million gallons of petrol per day (the chart shows sales “by refiners”, which presumably means in-country refiners), I see no way to argue with it.’

 
Me neither, Gasman. It works for me. Muchos gracias.
 

40 thoughts on “FAKE US RECOVERY: More fuel for Slog’s argument

    • Easier still: without a banking sector there cannot be a recovery. A bank that does not issue credit is not a bank, but a hoarder.

  1. There is a lot more people living in the cities now and using public transport, whether this accounts for the decline in fuel usage, I have no idea.

  2. If the US is the same as the UK then there is less domestic refining and more imported refined fuel. You also have to factor in more fuel efficient cars and the depression with people cutting back on expensive fuel. Energy consumption in the West is falling as energy rices rise and efficiency increases.

    The US should be energy self sufficient by 2025 and an exporter of LNG by 2015.

  3. No doubt the downturn has hit petrol sales but I’d love to see that chart adjusted (somehow, donno how) for greater fuel effeciency in cars.

  4. Pingback: John Ward – Fake US Recovery: More Fuel For Slog’s Argument – 7 July 2012 | Lucas 2012 Infos

  5. Two things spring to mind

    1 The increase in engine efficiency. This is quite a significant saving in volume per distance but, funny to say, tax hikes have taken that saving away.

    2. The graph talks of gasoline but does not say if that is in fact delivered pump volume of pure gasoline or gasoline/ alcohol mix which is about 88:12 ratio.

    If I am right on the two points above that could go a long way to explain most of the perceived drop in gasoline sales.

    • Three things spring to mind. Yours plus engine downsizing. 5 litre engines not cool off the dragster errr drag.

  6. Factor in huge improvements in in engine fuel efficiency/management,many more diesel engined cars (less fuel),and smaller cars (less fuel).All huge improvements since 1983.

  7. The US is the unspoken story. All eyes have been on Euroland and the banks which suits Obamaland. Don’t forget there’s an election coming up in November and they’re just hoping they can keep a lid on things until after then. All politically sensitive official statistics(eg employment figures etc) will be suspect until then.

  8. I can accept the general trend in the chart but that massive drop in October 2011 must be the result of some anomaly, maybe a change in the reporting method.

    Changes in petrol consumption due to recession, fuel-efficiency, migration to diesel etc. all take place over an extended period, many months if not years, they don’t fall off the edge of a cliff in one month like that.

    Anyone got any ideas ?

  9. John!!!
    – you’ve been had…
    According to Graph No.1 in the below
    (downloaded now to be on the safe side)

    http://www.fas.org/sgp/crs/misc/R42465.pdf

    Then things aren’t much different between years 1983 and 2011
    concerning per-capita consumption, with only a little improvement on efficacy, due to the larger cars (MPV, SUV) and commonplace
    unavailability of Diesel at the pump across the USA.
    Dividing Millions of Barrels by % of consumption,
    numbers visually estimated from the left and right-side graphs:
    1983: 4.2/0.28 = 15
    2011: 8.4/0.45 = 18.67

    313/[18.67/15] = 251 million Americans at 2011 consumption terms,
    which isn’t far (~7%) from the 234 million number.

    conclusion: FALSE alarm at today’s Slog article.

    PS: The link doesn’t work.

  10. I’d love to see an equivalent UK consumption chart. As a heavy duty road user with my job, I used to drive up to 1000 miles a week dashing up and down the country fixing stuff. About a year ago I started to notice a
    big drop off in *Non rush hour* motorway traffic, much less lorries and cars.
    Note the caveat.

    • I used to do 30,000 miles a year driving, My workload hasn’t changed, but at some point, filling up a tank every second day just got to the point where it made no sense to try and do my job that way. That and the risk of 12 points a year through ‘speeding’ in roadworks areas and 30mph secret cameras, just meant people could continue to cock things up on site as always, but I would now sort it out from a distance and not try to bail them out.
      Plus I now fly abroad more, but pay these ridiculous flight taxes instead.

  11. “this simple and direct measurement of health.”

    Says who? Given a myriad of other factors at play, i am hard pressed to call petrol consumption a simole and direct measurement of health.

  12. Even more telling is the ceridian index of diesel consumption.
    Diesel is the very lifeblood of commerce in the US.
    Same steep drop as petrol in 2008 ,and barely moved
    up since then.Petrol is to some extent a discretionary fuel,
    diesel is not.
    The US economy is now dead,after being buried alive by
    politicians ,bankers ,regulation and outsourcing.
    The corpse is just twitching now and then as rigor
    mortis sets in..

  13. Come on, look at the data source “Sales by refiners”. Refiners do NOT sell all the gas to the US public. This chart excludes all the independent chains and gas imports. This chart simply illustrates the structural shift going on in the US refining industry. No new refiners have been built in the US since @1976 and plenty have been shut down in the last 5+ years due higher regulatory costs being shoved down there throats, just like ObummerCare. Now they are getting out of the retail side of the business because it is the correct business decision.

    • “Even more telling is the ceridian index of diesel consumption.
      Diesel is the very lifeblood of commerce in the US.
      Same steep drop as petrol in 2008 ,and barely moved
      up since then.Petrol is to some extent a discretionary fuel,
      diesel is not.”

    • Good answer. Lets see electricity consumption instead. Electric Power is the lifeblood of any economy

  14. It seems like people have a hard time believing the fact that the states is most certainly not in recovery… why they would believe government generated fiscal info from the same bunch of twits that were asleep at the wheel when G/Sachs struck ice… I don’t understand. EVERY country is lying about their economy… it’s the same ego fueled, delusional idiots that are trying to BS their way through this in every single country on earth… the whole worlds economy is on the brink of collapse and I GUARANTEE you that most of these guys are only worried about their bonus.

  15. Purely anecdotal but we have reduced our fuel consumption by more than 30% over the last few years and have reduced overall outgoings by over 20%.

    Austerity can be fun, watching the Chancellor panic whilst he exhorts Bankers to push harder on the string is a sight to behold.

  16. Whilst fuel consumption is a good gauge of economic activity as is the dow jones transport index, i for one would like to see a graph of U.S. Electricity usage (non domestic). To see retail and manufacturing usage would be the clincher. Anyone have access to such data?

  17. Cars in America have become far more fuel-efficient since 1983, simple as that. In fact, they’ve become far more efficient since 2003. Nobody in their right mind here in America would drive a car manufactured in 1983, except as a curio. DOH!!!

    • Duh.
      Average age of vehicles in use in the US is 13 years.
      Do not believe the ‘sales’ figures being issued in the US.
      Dealer is stock is at record highs and climbing every month.
      the ‘sales’ are no more true than the unemployment rate.

      • This guy is a paid right wing blog poster… he is a pro corporate, pro oil, anti Obama cheerleader… I have noticed this blog get infiltrated by people that are just spouting the most ridiculous non sense… populist hype designed to whip up the angry white American to vote Republican.

  18. I am not sure that fuel efficient engines is the only answer. One of the way to check to see whether vehicle use is down (which would reduce fuel consumption) is to check other related factors.

    Two things spring to mind that correlate directly with vehicle use, brake pads and tyres. If the sales of these items are also down, then it is fair to say that vehicle use overall is down, and thereby the fuel consumption.

    If these figures show no reduction, then it should be assumed that refined petrol is being sourced elsewhere and not showing in the original chart, either by importation or the use of synthetics.

  19. Gas mileage has increased dramatically since 1983. I know, I used to live there then, and my V8 car got 15 miles to the USG. Now it would be at least 30. Go figure!

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