The soaring European new car registrations are seen as having little impact on the dropping fuel consumption, with oil refiners and producers profits still dragging as motorists choose more efficient autos, according to analysts.
Last month European new car sales jumped almost 15 percent, the fastest monthly pace in more than half a decade, thanks to increasingly low interest rates and surging employment. But Vienna-based JBC Energy predicts sales of both gasoline and diesel in Europe are going down each year to 2020 – with combined demand for fuel from passenger transport down almost 10 percent that year at 2.9 million barrels per day (3.2 million barrels per day forecasted for 2015). “Car sales data in Europe mean little for oil demand as these are not first time buyers, it’s someone upgrading, swapping a clunker for something more fuel efficient or switching from diesel to gasoline,” comments Seth Kleinman, head of energy research at Citigroup. Additionally, the growing fuel efficiency has also outweighed the recent consumer interest in larger sport utility vehicles, spurred in part by cheaper gasoline prices. In the United Kingdom, the average new car last year had an average fuel economy of 58.1 miles per gallon(4.9 liters per 100km) compared to 43.2 mpg a decade ago, an increase in efficiency of 34 percent according to figures from the Society of Motor Manufacturers and Traders.
Analysts also add the surging sales triggered by the turnaround from the collapse brought by the recent financial crash would be followed by leveling demand during the next ten years. Additionally, analysts also point out to changing usage habits from drivers – with reliance on smart technology and high levels of traffic jams making people search for alternative modes of transportation.