Crude oil supplies fell by 1 million barrels in the latest week, gasoline inventories increased by 2.9 million barrels, and distillates, which include heating oil, rose a modest 700,000 barrels. All remain above the upper boundary of the average range for this time of year.
What interests me at the moment is the fact that gasoline demand is up an impressive 6.2% in the week ending October 2 versus one year ago, even as total economic output remains well below a year ago and unemployment is much higher.
Convention wisdom would suggest that a much higher unemployment rate and depressed economic activity would dampen demand of gasoline. But the opposite has happened.
Source: Energy Information Administration
Gasoline priced above $4 per gallon likely encouraged some drivers to stay off the roads, but gasoline south of $2.50 per gallon may have been just what was needed to get some of these former conservationists back into their automobiles.
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