Not Guzzling Quite So Much Gas

As the pump price climbs ever higher and the population ages, U.S. road traffic is falling


It’s not just Palm Beach. Traffic levels are trending downward nationwide. Preliminary figures from the Federal Highway Administration show it falling 1.4% last year. Now, with nationwide gasoline prices having recently passed the inflation-adjusted record of $3.40 a gallon set back in 1981, the U.S. Energy Information Administration (EIA) is predicting gas consumption will actually fall 0.3% this year. That would be the first annual decline since 1991. Others believe the falloff in consumption is actually steeper than the government’s numbers show. “Our canaries out there tell us they are seeing demand drop much more considerably than the fraction the EIA is talking about,” says Tom Kloza, chief oil analyst at Oil Price Information Service, a market research firm in Gaithersburg, Md.

Is oil-guzzling America changing its profligate ways? Some think so, though it’s worth noting the U.S. still consumes one-third of the world’s annual gasoline output. “It appears we’ve finally hit the ceiling that’s causing the U.S. population to rethink how and where they use their vehicles,” says Paul Weissgarber, who heads the energy practice at consulting firm A.T. Kearney.

Business Week