Posts Tagged ‘Energy Information Administration’

Public Transport Booms in the Recession

Monday, July 2nd, 2012

Soaring gas prices lured Americans out of their cars and onto public transportation, adding up to a five percent increase in ridership in the first three months of 2012, the most significant 1st quarter increase since 1999.  According to the American Public Transportation Association (APTA),  Americans took almost 125 million more rides on public transit in the first three months of 2012 than they did in the same timeframe last year.  Ridership declined following the September 11, 2001, terrorist acts and had remained more or less stagnant until last year.

“More people are choosing to save money by taking public transportation when gas prices are high,” said Michael Melaniphy, APTA president.  Gas prices aren’t the only reason for the growth, Melaniphy said.  With local economies rebounding, more people are commuting to new jobs, some of them on public transportation, he said.  “As we look for positive signs that the economy is recovering, it’s great to see that we are having record ridership at public transit systems throughout the country.”

There are a number of reasons why more Americans are using public transportation,” according to Melaniphy.  “For example, public transportation systems are delivering better, reliable service and the use of real-time technology, which many systems use, makes it easy for riders to know when the next bus or train will arrive.”  Melaniphy said the growing public transit ridership should encourage lawmakers to reach a deal on transportation spending.  Congress has been negotiating on a possible compromise on transportation spending for some time.  “As Congress is negotiating a federal surface transportation bill that is now more than 2 ½ years overdue, our federal representatives need to act to ensure that public transportation systems will be able to meet the growing demand,” Melaniphy said.  “It’s obvious from the surge in public transit ridership in the first quarter that Americans need and want public transportation.”

The federal Energy Information Administration said that U.S. gas demand fell to a 11-year low in the 1st quarter, at less than 8.5 million barrels a day; that was 1.5 percent less than the 2011 1st quarter average.  The drop came as the average nationwide price of regular-grade gasoline set a 1st quarter record of $3.60 a gallon, an increase of 9.6 percent when compared with last year.

APTA reported that all public transit modes saw 1st quarter increases, with light-rail use up by 6.7 percent and subways and elevated train ridership up by 5.5 percent.  Commuter rail ridership rose 3.9 percent, while bus ridership was up approximately 4.5 percent.

The fact that people are finding new jobs helped, said Melaniphy.  Ridership on heavy rail — subways and elevated trains — rose in 14 of 15 systems.  Use of light rail — streetcars and trolleys  rose in 25 of 27. And 34 of 37 large cities saw increases in bus ridership.  “It’s nationwide,” Melaniphy said, resulting in fuller trains and buses straining system capacity.

Fully 12 cities saw their highest ridership ever, including New York; Boston;  Oakland; San Diego; Charlotte; Tampa; Indianapolis; Ann Arbor, MI; Fort Myers, FL; Ithaca, NY; and Olympia, WA.

Gas Prices Coming Back to Earth

Tuesday, May 1st, 2012

After rising steadily for four months, gas prices at last seem to be stabilizing. Suddenly, pump prices have fallen six cents over two weeks to a national average of $3.88.  Experts say gasoline could fall another nickel or more in the immediate future.  Drivers might also get to say something they haven’t since October 2009 — they’re paying less for gas than they did last year.

“It’s nice, much more manageable,” said Mark Timko, who paid less than $4 per gallon recently in Burr Ridge, IL, a Chicago suburb, for the first time since March.  “I wasn’t sure how high they were going to go this year.”

Gas prices are lower than they were a year ago in 11 states, according to the Oil Price Information Service.  At $3.88, the national average is still costly, but it’s less than the peak of $3.94.  Predictions of $5 gasoline have  — thankfully evaporated.

Tom Kloza, publisher and chief oil analyst at Oil Price Information Service, believes that gas prices will drop to a national average of just above $3.80 soon.  Stuart Hoffman, chief economist at PNC Financial Services Group, said declining prices will put more money into the economy that Americans can spend on other things.  A 10-cent drop in gas prices means drivers have an extra $37 million per day.

Stabilizing crude-oil prices and “sufficient supplies” of gas have led to the price decline, Trilby Lundberg, president of Lundberg Survey, Inc., said.  The drop was the first in Lundberg’s twice-monthly surveys since December. The costliest gas in the lower 48 states was in Chicago, where the average was $4.26 a gallon, Lundberg said.  The cheapest price was in Tulsa, where customers paid an average of $3.52 a gallon.  “We can thank crude oil for allowing gasoline to do what it has been wanting to do for weeks, which is drop,” Lundberg noted.

The price of gas is becoming an issue in the 2012 presidential election.  President Barack Obama urged Congress to boost federal supervision of oil markets, including larger penalties for market manipulation and greater power for regulators to increase the amount of money traders must put up to back their energy bets.  “We can’t afford a situation where some speculators can reap millions, while millions of American families get the short end of the stick,” Obama said.  Mitt Romney, the likely Republican nominee, has accused the Obama administration of disrupting domestic oil production with regulations.

The Energy Information Administration weekly report noted that the nation’s crude oil stocks rose for the fourth straight week by 3.9 million barrels to 369.0 million barrels, better than anticipated.  Gas stocks fell by 3.7 million barrels to 214.0 million barrels.  Demand for gas saw a relatively small retraction of 103,000 barrels per day (bpd) to 8.681 million bpd.  Demand in the same week in 2011 was 500,000 bpd higher.  The four-week demand average for gas is still falling somewhat and currently stands at four percent.  Gas demand of 8.775-million bpd represents a 94,000 bpd increase, but reflects a 288,000-bpd drop from the same week last year.  The four-week moving average shows gas demand destruction of 2.8 percent; and the year-to-date numbers imply about 5.9 percent lower consumption.  Analysts can split hairs about actual motor fuel demand, but it is clearly lower than last year,

“April has seen more days of gas price declines than any month this year, which has motorists and analysts alike wondering if a gas price break is under way,” said Martha M. Meade, Manager of Public and Government Affairs for AAA Mid-Atlantic.  “While several factors influencing crude oil prices remain in play, some analysts believe gas prices will continue to retreat and sometime in the next ten days or so we could be paying less at the pump than we were a year ago.”

Americans may be mending their gas-guzzling ways, according to the Washington Post. According to Steven Mufson, “As prices have neared and in some cases topped $4 a gallon, drivers have cut their consumption of gasoline to its lowest levels in a decade, driving less and buying cars that are more fuel-efficient.  The adjustment has slowed the climb in gasoline prices, which until last week had risen for 10 consecutive weeks, and could preserve some money for Americans to spend on other items as the economy struggles to recover more convincingly.  In the Washington area, there has been an increase in applications for carpooling under the Commuter Connections program, which links people seeking to share rides. Applications rose 20 percent last year and 10 percent in January and February, in each case closely tracking the increase in gasoline prices, according to Ronald Kirby, director of the department of transportation planning for the Metropolitan Washington Council of Governments.  The response to $4 gasoline is reinforcing a trend toward lower fuel consumption.  This will be the third year in the past five with historically high oil prices. Even before the latest price spike, gasoline consumption had dropped six percent from 2007 through 2011, the Energy Information Association (EIA) said.  The Federal Highway Administration adds that the number of vehicle miles driven over a 12-month period ending January was lower than in any year since 2004.”

Gasoline purchases totaled four percent of total consumer spending in 2011, noted Mark Zandi, chief economist of Moody’s Analytics.  That’s more than the 2.3 percent recorded when crude oil prices crashed in 1998, and significantly less than the six percent level in 1981 when an oil price shock shook the economy.  “I’ve been surprised, at least so far, that $4 a gallon hasn’t done more damage,” Zandi said.  “So far, it doesn’t seem to have done any.”  According to Zandi, the improving job market is one reason.  Another is that the warm winter reduced people’s heating bills and evened out total household energy costs.

Rising Gas Prices Send Americans to Mass Transit

Monday, March 19th, 2012

American public transportation ridership rose 2.3 percent last year as gas prices rose to their highest-ever annual average, according to the American Public Transportation Association (APTA).  The 10.4 billion trips recorded last year was the highest since 2008, when gas prices hit more than $4 a gallon nationwide for seven weeks in the summer.

APTA said economic recovery, that sees more Americans commuting to and from work, added to ridership.  Approximately 60 percent of commutes are for work.  Greater use of smart-phone apps, which “demystify” schedules for riders, also boosted ridership, the APTA said.  Increases in public transportation were reported in communities of all sizes and among light rail, subway, commuter train and bus services, the APTA said.  The largest increase — 5.4 percent — occurred in rural communities with populations of less than 100,000, said Michael Melaniphy, APTA’s president and chief executive.

Spending on public transport totals in the region of $50 billion a year, Melaniphy said.  Funding for public transportation is split nearly 50/50 between federal dollars from the gas tax, money from state and local property and sales taxes, and ridership fees.

In Boston, where unemployment has fallen two percent since the beginning of 2010, ridership rose four percent last year to an average of 1.3 million passenger trips a day on weekdays, said Joe Pesaturo, of the Massachusetts Bay Transportation Authority.

Because of the recession, transit agencies were forced to operate more efficiently and better care for existing systems and equipment, said Robert Puentes, senior fellow in the Metropolitan Policy Program at the Brookings Institution.  That has resulted in better service.

In terms of specific modes of transit, light rail (including streetcars and trolleys) led with a 4.9 percent increase.  This was followed by heavy rail (subways and elevated trains) at 3.3 percent; commuter rail at 2.5 percent; and large bus systems at 0.4 percent.

It’s ironic that these increases occurred despite the fact that transit agencies have had to increase fares and decrease service because of budget cuts, according to Melaniphy. “Can you imagine what ridership growth would have been like if they hadn’t had to do those fare increases and service cuts?”