U.S. retail gasoline demand rose 3.1 percent in the latest week despite a sharp jump in pump prices as warmer weather boosted use of the fuel, MasterCard Advisors’ SpendingPulse report showed Tuesday.
Average gasoline demand climbed to 9.118 million barrels per day in the week to Feb. 25. Year-over-year demand shot up 3.8 percent for a seventh straight week of gains, MasterCard said.
Over the latest four weeks, U.S. gasoline consumption rose 2.6 percent year-on-year.
“We usually see a seasonal demand build-up in late February, early March. The reason we saw year-over-year increases last week is because of the lag in demand build-up last year,” said John Gamel, director of economic analysis for MasterCard Advisors SpendingPulse.
The increase came despite surging prices at the pump. Retail prices rose 9 cents last week to $3.24 a gallon, 21.3 percent higher than a year earlier after crude oil surged on unrest in the Middle East, MasterCard said.
National average retail prices rose to $3.38 per gallon by Monday, according to the U.S. Energy Information Administration (EIA). That was up 19 cents from the previous week’s prices and the second-largest one-week jump since the EIA began tracking weekly retail gasoline price data in 1990.
The effects of the price jump remain to be seen in coming weeks, MasterCard said. Last week, consumers filled their tanks in anticipation of even higher prices after crude surged on fears of supply disruptions due to unrest in Libya.
More drivers pumped gasoline starting on Wednesday last week but demand tapered off by Friday, Gamel said.
Demand rose year-on-year all through February even as prices held above $3.00 a gallon, near two-year highs, for the past 10 weeks, indicating a more structural change.
“Unemployment in January and February 2010 was at 9.7 percent but that’s down to 9.1 percent this year. If more people are working now than a year ago then more people are driving,” Gamel said.
MasterCard Advisors, a unit of MasterCard Inc, estimates retail gasoline demand based on aggregate sales activity in the MasterCard payments system coupled with estimates for other payment forms including cash and checks.
