UPDATED: see below
A few days ago I did a report on the U.S. Energy Information Administration (EIA) numbers for carbon dioxide emissions, showing that it was clearly down, and back to levels not seen since 1994, and noting that since Kyoto in 1997, U.S. emissions have dropped even though Kyoto was never ratified in the USA.
If you thought that was troubling and strange have a look at these numbers which also indicate the state of the U.S. Economy. First, the number of miles driven monthly for the last 30 years. As you can see, just like global temperature has flatlined, so has the number of miles driven.
Source data: http://research.stlouisfed.org/fred2/series/M12MTVUSM227NFWA
Now the amount of gasoline sold. Note the regular seasonal “heartbeat” pattern up to about 2008, then that pattern gives way to a precipitous drop at the end.
Source data: http://www.eia.gov/dnav/pet/hist_xls/A103600001m.xls
If that doesn’t paint a grim picture of the U.S. economy, I don’t know what will.
Zerohedge writes:
…but the biggest question we have is just how did the biggest boost in energy and engine efficiency occurred at two key junctions: Just after the Lehman Failure, and just after the US downgrade and the first debt ceiling crisis, when the total sales of gasoline by US retailers literally went off the charts, and which data series is now languishing at levels not seen since the 1970s (unfortunately we can only estimate: not even the EIA’s data set goes back that far).
Perhaps, just perhaps, Occam’s razor applies in this situation as well, and the collapse in energy demand in the US has little to do with MPG efficiency, higher productivity, and throughput mysteriously achieved just when the entire economy was imploding in the months after the Lehman failure, and despite the re-emerging proliferation of cheap Fed debt funded SUVs and small trucks, and everything to do with the US consumer being slowly but surely tapped out?
Of course, if that is the case, than the US economy is far, far weaker than even we could have surmised, although it certainly would explain the desperation with which the Fed is doing everything in its power to preserve the levitation of the S&P, i.e., the confidence that all is well despite all signs to the contrary. Because should the market finally be allowed to reflect the underlying economy – not the administration represented economy, but the real one – then everything that has transpired in the past five years will be child’s play compared to what’s coming.
I wonder if that brilliant economist of the NYT, Paul Krugman, can pull the wool out of his eyes long enough to comprehend this?
h/t to Kate at Small Dead Animals for getting me interested in this enough to plot the data myself to see if it was true.
UPDATE: I added this is response to comments about the number of miles not dropping as fast. “jeez” points out that miles driven are an estimate from surveys.
If people are driving less miles, we have less consumption, and that would mean excess supply and lower prices. Lower prices should then result in more people driving more, sort of a self correcting feedback.
Instead what we have is a 50% drop in retail sales of gasoline during a period of reduced driving.
That says to me that many people have just stopped buying gas. Consider that 90 million people are now out of the workforce. Look at this graph and that helps explain part of what we are seeing.
UPDATE: Correction. From this comment, I agree, the Zerohedge article focus on retail sales is misleading, see new plot I did below. I’m not privy to the vagaries of gasoline supply/sales channels, and had I been, this would have raised more suspicions. Thanks to WUWT readers for the peer review! – Anthony
Anthony,
As a few others have mentioned, the bug is in “retail sales by refiners.” There has of course been wholesale in the past to off-brand distributers (i.e. 7-11 selling gasoline that they sure don’t refine) compared to Exxon selling Exxon refined gasoline. At those drop-off points what likely happened is that fewer people were willing to spend a few extra pennies stopping at Exxon, and now buy their gas at Wal-Mart or Kroger when they do their grocery shopping.
The fact that
http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MGFUPUS1&f=M
http://www.eia.gov/totalenergy/data/monthly/pdf/sec7_5.pdf
both align with the CO2 and other data (like total petroleum consumption) makes it much more reasonable to think there has been a ~10% decline in gasoline purchases than a 50% decline. Otherwise we would have to ask how we cut 25% of our Carbon use (petroleum is ~1/2 of our carbon use, and a 50% decline in that would be a total of 25% of all carbon) while only decreasing carbon emissions by ~10%.
(Note: To test this I plotted the EIA data below from here: http://www.eia.gov/dnav/pet/hist_xls/MGFUPUS1m.xls – Anthony)
A 10% decline would then be appropriately explained by 4% decline in labor, increases in fuel efficiency, and smaller factors like online shopping (remember, somebody still drives it to your house – and usually they leave a large truck idiling while they walk the package up and have you sign). A 10% drop is still a huge amount of gas, but it is not the same as a total societal collapse that a 50% drop in 4 years would indicate.
I assume this was probably an honest mistake, but since it has been pointed out several times I think the most honest thing to do is change the data set and correct the article.
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Total miles are down but seem to have stabilized; vehicle miles includes trucks and buses; they generally burn diesel. Do you have any historical usage curves for diesel? Any historical data on the split of total miles between diesel and gasoline? If the proportion of gasoline miles to diesel miles is basically unchanged and total miles is flat then it would seem reasonable to attribute declining gasoline sales/usage to improved overall gasoline engine performance.
What are the figures for sales of bicycles?
Just a thought.
We know its all a money making scam! One volcano, just one gives out more CO2 than whole of mankind’s existence?
Money-making scams:
Y2K virus………biggest BS ever and millions made out of it
CFC’s……..favours US export and companies
Ozone depletion………BS
AGW…….trillions made of it
CO2……..millions made if not trillions
Peak-Oil (fossil oil)…….crude price control all BS anybody heard of A-biotic oil? Must have been a lot of dinosaurs on Titan then…oceans of hydro-carbons!
And many more to come……………
From 1978 to the present I am sure the US population has grown so even though the workforce participation RATE has fallen from a peak of 67% to 63% now the actual NUMBER of people working has probably increased so the participation RATE cannot be taken as a proxy for petrol use.
REPLY:your “probably” argument doesn’t cut it here, show some data – Anthony
The statistics does not include all motor gasoline sold. You can find the total numbers here:
http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MGFUPUS1&f=M
As you can see it is four times bigger than the retail sales by refineries
I have also done some basic math to check:
The retail sale from the first link (retail sales by refinereies) is 62 M Gal/day in 2000. The other link (Total supplied motor gasoline) is 220 M Gal/day
If you divide these numbers with the approximately 250 M cars in the US you get a more reasonable figure from the latter statistics.
The greens are cheering though.
Deindustrialization is what they preach; depopulation is what they want. People should be alarmed by the lack of growth of the economy, yet they are alarmed by non-existing warming…
@Steve B — or the currency has been inflated by over 25% and the 10% increase equals at least a 15% drop in actual sales volume. My own calcs have shown purchase price for a 2 year old low mileage car has risen over by 30% in 2 years. That is simply a function of the inflating currency. Do the math on the unit price of gas and see what you get !!
The Bernank is printing over a trillion a year, atm
I think Electricy consumption would tell you far more about the overall state of the nation. Lower consumption could reflect less manufacturing or reduced home energy use or combinations of the two. Your population has increasedover time so has electricity generation increased proportionately or has it lessened?
Anthony,
You say, “Consider that 90 million people are now out of the workforce.” The entire US workforce has never been over 156 million. How can that be?
While gasoline demand has plunged, during the same period US GDP has grown by 1.2 Trillion dollars. Up over 8%.
JP
So now the question is why have refineries’ sales of gasoline gone down by half? I know a few big refiners went out of business recently so that would account for some, but half?? And who is picking up the slack? Is the US importing refined gasoline now?
Instead what we have is a 50% drop in retail sales of gasoline during a period of reduced driving
That says that oblarny has succeeded. These 2 together can mean only one thing, Price hike.
Miles traveled is presented by the Federal Reserve Bank of St. Louis. The Federal Reserve has individual banks in different regions of the US, since different regions have differing economic outputs and will respond differently to the macro economy. The individual banks then report to the central Fed. The reporting of the mileage is only for that region. That should explain the difference.
Now guess where incomes have not stagnated but, instead gone up; where home values never declined with the collapse of the housing market and, in fact, are still appreciating; and, finally, where unemployment is about the lowest in the country by a significant margin. Washington and the surrounding metro area.
Hope & Change!
Anthony, forgive my failure to provide US population numbers. I thought my point about the RATE of workforce participation was self-evident!
The population of the USA rose from 225m in 1979 to 282m in 2000 and to 314m in 2012 according to data given here http://www.google.co.uk/publicdata/explore?ds=kf7tgg1uo9ude_&met_y=population&idim=country:US&dl=en&hl=en&q=population%20of%20usa
So, a drop in workforce participation from its peak of 67.3% in 2000 to 63.3% in 2012 STILL results in an actual INCREASE in the workforce from 189.79million to 198.76million
I repeat, you cannot use the reduction in the RATE of workforce participation as a proxy for the use of gasoline (or petrol as we call it in the UK). Sorry.
“If people are driving FEWER miles”…. not “LESS miles” 🙂
More importantly what is the trend in trucking miles ? The delivery of goods and materials is a strong indicator of economic health … if that is reducing then fewer goods are being delivered and less material being consumed … which means that private (retail) consumption is down and manufacturing is down … BAD BAD BAD !!!
Maybe that graph only tells part of the story as it only shows retail sales by refineries. So it does not include imported gasoline nor any blending (is it 10% ethanol now?).
Also what about diesel – has its use grown significantly? In the UK petrol (as we call it) sales are down markedly but diesel is up a bit.
The chart only shows gasoline. Could the explanation be as simple as that people who drive a lot of miles are now buying Diesel cars? this would show up as a decline in gasoline but there should be an uptick in diesel but not as big as diesel uses 5 liter per kilometer and gasoline consumes 7-10 liter per kilometer.
marchesarosa says: April 10, 2013 at 1:30 am
Anthony, forgive my failure to provide US population numbers. I thought my point about the RATE of workforce participation was self-evident!
The population of the USA rose from 225m in 1979 to 282m in 2000 and to 314m in 2012 according to data [ … ]
So, a drop in workforce participation from its peak of 67.3% in 2000 to 63.3% in 2012 STILL results in an actual INCREASE in the workforce from 189.79million to 198.76million
—————–
Population has increased by over 11% but participation has reduced by ~4% … the economy has failed to keep up with creating sufficient jobs for its increasing population. Employment will naturally grow with an increasing population but this is not a result of increased prosperity which fuels consumption. Essentially, net unemployment has increased and this is reflected in a drop in consumption of gasoline.
BioBob (April 9, 2013 at 10:45 pm) said: “The second the Fed stops pumping money or the interest rates start rising the fat lady will be taking a deep breath. If something can not continue to go on — it won’t.”
The Fed won’t stop. They are now printing money to give directly to politicians to spend. There is almost zero political will to stop the Fed, most people don’t have the faintest grasp of the seriousness of the situation. As long as the Fed prints we have no way to grow out of debt (personal and government) because investors cannot commit money for long terms to get big boosts in productivity. We are all speculators now even if we believe we are buying and holding. Companies speculate on our behalf using simple carry trades or more complex investment fads. Even China’s productivity growth is tapped out and our Fed mostly exports inflation to places like that. The bottom line is that a hollow economy has less need for gasoline to commute to better jobs because there are few better jobs.
Hmm. I thought the main “driver” for reduced CO2 emissions in the US was the shift from coal to (shale) gas?
I’m trading my truck for a gas-sipper at the end of the month. I’ll be using about 40% less gasoline after the switch. Someone with the initials of Anthony Watts drives an electric car and is certainly not putting much coin in the pockets of big oil.
Anecdotal evidence, sure, but what percent of the drop in usage has nothing to do with the general economy and everything to do with people being tight with a buck? Hard to measure, I’m sure.
Scary charts … looks like we’re becoming the land of the hungry and the home of the unemployed.
It is five times farther to drive to work every week
than it is to drive once a week to sign up for unemployment!
Alfred
It is amazing what an increase in unemployment and lowering of living standard will do. Well done Obama!(?)
Time for change i think.
I really question the 50% reduction number. I just don’t see 50% fewer people on the road or at the gas station. I highly suspect that number. Also, 90million people out of work? Come on, that’s 1/4 of the US population. Unemployment is not at 25%…..