|SMost “reference case” or “business as usual”
forecasts today show petroleum demand in the United States continuing to grow
over the next 25 years or so, driven by transportation fuels.
|SEIA’s reference case shows petroleum demand
for transportation fuels reaching a level in 2025 that is more than 50%
greater than petroleum transportation demand today. An additional 7 million barrels per day
will need to be supplied over what was supplied in 2000, which indicates a
need for more capacity.
|SFactors can change this outlook. It would seem that a significant slowing in
demand growth or a significant shift in the mix between diesel and gasoline
could have tremendous impacts on the shape of the refining industry in the
|SBut do such alternative scenarios merit
consideration? History can provide
some insights. For example, in the
early 1980’s, high prices, a recession, and improved vehicle fuel efficiencies
helped reduce demand.
|SThe next slides consider the potential impact
of fuel efficiencies.