US demand for gasoline to drop: AP report

The demand for gasoline might never get back to levels seen during 2006, as alternate forms of fuel gain more popularity, a report by AP said.

By 2030, Americans will burn at least 20 percent less gasoline than today even as the numbers of cars go up, the report said, citing experts.

Demand for oil generally slumps during the recession and picks up in a few years. However, most executives of oil companies, including ExxonMobil, agree that demand has peaked for good, the report added.

America is one of the largest consumers of oil and gasoline products.

People are getting more energy conscious, switching to cheaper and more environment-friendly sources of energy. The U.S. government is also pushing fuel alternatives, and trying to educate people to reduce carbon emissions.

The government is also trying to make cars more fuel-efficient, providing more mileage. Major auto manufacturers such as GM are releasing more electric cars, which have the same amount of horsepower as the one that runs on oil or gas.

These cars that are known as green cars are also beneficiaries of several government subsidies that help their popularity.

Starting in 2012, each carmaker's fleet much average 30.1 mpg, up from 27.5, the AP report said.

By the 2016 model year, that number must rise to 35.5 mpg. And, starting next year, SUVs and minivans, once classified as trucks, will count toward passenger vehicle targets, the report added.

Also, by 2022, U.S.'s fuel mix must include 6 billion gallons of ethanol and other biofuels, up from 14 billion gallons in 2011, AP said.

Additionally, the high cost of gas and demand in Asian regions will promote the use of biofuels and alternative sources of energy in the U.S.

OTHER FACTORS

The report stated that gasoline consumption will also be affected by other factors.

Baby boomers will drive less as they age. The surge of women entering the work force and commuting in recent decades has leveled off. And the era of Americans commuting ever farther distances appears to be over. One measure of this, vehicle miles traveled per licensed driver, began to flatten in the middle of the last decade after years of sharp growth, the report said.

This is expected to result in lower demand and lesser dependence on foreign oil, as well as benefit the environment.

The demand for fuel guzzlers such as SUVs and Hummers fell during the recession when oil prices peaked.

The U.S. will still remain one of the largest consumers of gasoline, followed by China, the report said.

However, the decrease in demand in the U.S. will be offset by the increase in Asia and other Middle Eastern countries, ensuring that oil prices will continue to remain high.