Study: Gas demand dropped 20% in March

Not surprisingly, traffic has been a lot lighter after regulations and recommendations to stop the spread of coronavirus went into effect in March.

A new study by GasBuddy, released this week, backs that up with some statistics on gasoline demand.

GasBuddy, which uses data from consumers to track gas prices across the U.S. and Canada, found demand for fuel dropped 20% in March when compared to the same month of 2019. There were additional yearover-year declines in fuel transactions — down 14% — and total payment volume — a 28% drop.

According to GasBuddy, the numbers come from fuel transactions via its fuel saving program used by 750,000 members.

These drops come at a time when gasoline has never been cheaper due to a combination of the massive global surplus of crude oil and drop in demand.

GasBuddy had the average price in the Philadelphia area at $2.21 per gallon on Thursday. In three months, the average price has dropped 55 cents in the region. A year ago, the average price was rising toward $3 per gallon.

Sarah McCrary, GasBuddy CEO, said gas prices are normally on the way up in the spring.

“The dramatic shift in fuel buying upends the pattern of rising gas prices and demand ahead of the warmer months,” McCrary said in a statement. “This data reflects the depth of the impact to consumer and commercial activity the world is experiencing.”

Examining month-overmonth transactions, gallons purchased dropped 10% from February through March, GasBuddy said. This is a reversal of the trend in transactions established in the previous two years. In March 2019, gallons purchased increased 20%, while in March 2018 gallons purchased increased by 25%.

AAA, which also monitors gas prices, said it hasn’t seen this level of demand in more than 50 years.

“We are seeing fast and furious gasoline demand destruction,” said Jeanette Casselano, AAA spokeswoman, in a statement. “The latest data reveals demand levels not seen since spring of 1968. Every U.S. region is seeing builds in gasoline inventories and crude storage, which is just driving pump prices even cheaper.”

AAA says the deal to cut production by OPEC and other oil producing nations reached last weekend should have little effect on prices here.

“While the production cut is historic, it’s likely to not have an immediate impact on pump prices given the ongoing impact the COVID-19 pandemic continues to have on crude oil prices and gasoline demand,” said Casselano.