Short-Term Energy Outlook Model Documentation: Motor Gasoline Consumption Model
November 30, 2011
Overview
The motor gasoline consumption module of the Short‐Term Energy Outlook (STEO) model is designed to provide forecasts of domestic motor gasoline consumption. The frequency of the STEO model is monthly and the model equations are used to produce monthly forecasts over a 13‐to‐24 month horizon (every January the STEO forecast is extended through December of the following year).
The STEO model contains over 2,000 equations, of which about 450 are estimated regression equations. The regression equations are estimated and the forecast models are solved using EViews Econometric Software (Quantitative Micro Software, LLC).
The motor gasoline consumption module, which is documented in this report, contains 12 equations, of which 3 are estimated regression equations. Some input variables to the motor gasoline consumption module are exogenous, coming from other modules in the STEO model or forecasts produced by other organizations (e.g., weather forecasts from the National Oceanic and Atmospheric Administration).
Gasoline ʺconsumptionʺ refers to deliveries from primary suppliers, which include refineries, blenders, pipelines, and bulk terminals. Deliveries therefore differ from retail sales. Between 1999 and 2010, total motor gasoline consumption growth averaged 0.7 percent per year. Motor gasoline consumption is highly seasonal, as shown in Figure 1. Total gasoline consumption, which averaged 8.99 million barrels per day (bbl/d) during 2010, ranged from a low of 8.52 million bbl/d in January 2010 to a high of 9.36 million bbl/d in August 2010.
The motor gasoline consumption module derives total gasoline consumption from separate estimates of highway‐related and non‐highway‐related gasoline consumption. Highway‐related consumption, which accounted for 97 percent of the total in 2009, includes usage by households; public transportation systems; and commercial, institutional, and government entities. Non‐highway consumption includes usage by recreational boats and agricultural and industrial (including construction) entities.