California gasoline demand rolls out with the surf (The Barrel)

Aiden and Sophie are going to need to learn to get along in the back seat, because Mom and Dad are about to cut into their elbow room.

It?s just one consequence of consistently dropping gasoline demand in California: multi-car families leaving the gas hog in the garage and rolling out in the compact to shop or rush to soccer practice.

California taxed 83.627 million barrels of gasoline in January, February and March, according to the most recent set of tax statistics released by the state Board of Equalization.

That?s a 1.4% drop from the same period in 2012 and 1.8% from the first quarter of 2011. Fuel tax receipts ? which California officials record to the dollar ? provide a good window on demand trends.

Demand at the pump has decreased in the Golden State every year since 2006 except 2010, said David Isaak, a principal consultant at FACTS Global Energy (FGE) in Orange County, California. (Why did 2010 have it so lucky? California and the rest of the nation was on the rebound from the Wall Street crisis and bailout.)

?The fall isn?t much of a mystery,? Isaak said. ?The biggest factor has to be the switch to more-efficient vehicles.??He knows. He drives a Prius.

He also cites more carpooling, more trips on the buses and trains in the cities that have them and more stay-at-home nights. Pump prices provide a good reason to have those Sons of Anarchy marathons, too. Regular gas was at $4.095 per gallon in Los Angeles on Tuesday morning, up 36 cents/gal from one year ago, according to AAA.

And why not stay home when going out is positively grim? This motorist who shared his entire trip on YouTube reports needing 147 minutes and 11 seconds to travel 30 miles in the Los Angeles area. That?s a little short of 17 mph and only a little bit faster than a marathon champion runs. Feel his agony right here in this video.

Isaak also says more families that have two or three cars are picking the sipper to go out. Hence more ?Mom, he?s hitting me!? moments in many a family future.

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One businessman who fled the state for Nevada said the business climate in California has put a big gray cloud over the beach party. Stunted growth means fewer people driving to work. US Energy Information Administration data reveals a 2.9% drop in vehicle miles traveled from 2006 to 2012.

?The Silicon Valley miracle will not save them. They could use a fourth PC/Internet/social networking boom,? said Chris Mennis, the principal in Fuelmarket LLC.com, a wet barrel brokerage arm. ?Places like Nevada, Arizona, Oregon, Washington Wyoming and Utah are much better for small biz.?

Consider the wide swings confronting the diesel retailer in California. He or she saw diesel demand drop 3.2% in 2012, according to EIA data. It?s not all downward: diesel use rebounded in the first quarter with a 3.8% jump over Q1 2012, Board of Equalization Chairman Jerome E. Horton said this week.

By taking sippy cups to the pumps, Californians are bucking one trend. The census revealed that California topped 38 million people last year. It?s up 2.1% from two years ago but not enough to keep enough tires on the road to at least level demand.

?Unless population growth in California speeds up, declines in California gasoline demand should be expected,? Isaak said.

And Sophie and Aiden are going to need a few more pairs of headphones.

More:

? One week in California traffic as seen on social media (Storify)

? Latest California gasoline prices (AAA)

? Traffic Jammin? with Janis Mara: tales from the delays in Contra Costa County near San Francisco

Source: http://blogs.platts.com/2013/07/16/cali-gas/

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