U.S. Diesel Fuel Demand Forecasted to Peak in 2015, Then Decrease

November 18th, 2014 by Fiedler Group

According to “An Assessment of the Diesel Fuel Market: Demand, Supply, Trade and Key Drivers,” a decline in diesel demand in the United States is expected in 2016 due to an increase in vehicle efficiencies coupled with the growing adoption of compressed natural gas for heavy-duty vehicles.

Diesel demand is forecasted to decrease 12.5 percent to 3.5 million barrels per day in 2030 after hitting a peak of nearly 4 million barrels per day in 2015.

The report, penned by the PIRA Energy Group, was commissioned by the Fuels Institute in partnership with the NATSO Foundation.

The 32-page report analyzes domestic diesel demand, production capacity for diesel fuel, international demand, and requirements that may impact overall demand for diesel fuel.

By 2030, domestic light-duty diesel-fueled vehicle demand is expected to more than triple — from less than 0.3 million barrels a day to 1 million barrels a day.

And yet, diesel fuel will still face competition from other fuel alternatives including electric vehicles in all its forms, be it hybrids, plug-in hybrids, and pure electric. Further engine efficiencies will also decrease overall fuel demand.

And for heavy-duty vehicles, by 2030, total domestic diesel demand is expected to decline over 12 percent — from 2.6 million barrels per day to 1.8 million barrels per day — due to competition from natural gas and expected vehicle efficiencies.

According to John Eichberger, Executive Director of Fuels Institute, “The U.S. is well positioned to supply its own domestic fuel needs while also playing a growing role as a global product exporter.”

So while U.S.-based demand for diesel decreases, the U.S. will expand its role as an exporter.

For more details, download the full report at www.fuelsinstitute.org.