The Energy Information Administration (EIA) recently came out with its monthly U.S. gasoline production report for August, showing that Americans are using more gas per day than ever before.
In this clip from Industry Focus: Energy, host Sean O'Reilly and energy analyst Taylor Muckerman explain why and how we're seeing a spike in gas use when cleaner energy and fuels are increasingly becoming mandatory.
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A full transcript follows the video.
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This podcast was recorded on Sept. 29, 2016.
Sean O'Reilly: Speaking of the EIA, they justcame out with United States gasoline consumption, whichthey do on a monthly basis. Interested to get your thoughts on this.
Taylor Muckerman:I'm thinking August made news?
O'Reilly:A little bit, yeah. TheUnited States consumed 9.7 millionbarrels of gasoline per dayin August. That isa new record. It's a little bit more than the peakright before the Great Recession.
Muckerman:In 2007, right?
O'Reilly:Yeah. It'sinteresting to me because, correct me if I'm wrong,cars are way more efficient right now in miles per gallon.
Muckerman:Yeah, they're more. They're getting to be way more, but they'renot quite there yet. There's still a few more yearsbefore all the CAFE standards fully kick in. But there are year-over-year requirements. What you're seeing is, asshort-sighted as Americans are, they'regoing out and buying record numbers of SUVs and trucksagain because gasoline is cheaper than it's beensince 2009. The cheapest Labor Day gas pricesin the last 12 years. SUV and truck sales have been outpacing car sales for quite a while now. You're looking at, if not record, near-record sales for SUVs and trucks, still. It just continues to rise. Thosestandards, because of increasing fuel efficiency standards,applied to the car based on what is called a footprint. So you're looking atlarger cars not having to meet as strict demand as quickly. So,these cars haven't really experiencedthe dramatic fuel efficiency gains as you've seen in smaller sedanslike aToyotaCamry or Corollaor those hybrid vehicles that have come out that get 50 to 60 miles to the gallon.
O'Reilly:Right. So, we've throwna lot of data points at our audience so far. You have OPEC who is notoriously untrustworthy. You have the supply-and-demand statistics that are iffy on a global basis,but it is what it is.
Muckerman:Some people suggest that 2017 could be equilibrium for supply and demand.
Sean O'Reilly has no position in any stocks mentioned. Taylor Muckerman has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.