U.S. driving drops for 9th straight month
By John Crawley
WASHINGTON (Reuters) - Motorists on U.S. roads applied the brakes hard on driving when gasoline prices peaked over the summer at more than $4 per gallon, according to the latest government figures released on Tuesday.
The 3.6 percent year-over-year decline in miles traveled on all roads in July cemented a downward trend begun nine months ago in response to rising pump prices and economic weakness.
While the June drop was 5 percent, the July drop was still sharp and may be more illustrative of consumer habits and concerns about the economy. July is a usually heavy driving period marked by traditional summer vacations and the Independence Day holiday.
"The decline means Americans are consuming less fuel and emitting less CO2 (tailpipe emissions), which is a positive development," Transportation Secretary Mary Peters said in an interview with Reuters. "But it is a challenge to how we fund transportation today."
The miles traveled figure is an informal economic reference for policymakers who sought to make the best of another bad number by touting rising transit figures. The drop in driving heightened concerns about how to pay for road and rail projects, since those employment-creating priorities are financed mainly by gasoline taxes.
Peters, who expects the mileage figure to rebound once consumers lower their transportation costs by purchasing more fuel efficient vehicles, made her comments enroute to Richmond where she announced $30 million in federal grants to states to help finance more than 15 rail projects. Virginia received $2 million.
Average retail gasoline prices at the end of September were nearly 50 cents lower at $3.63 per gallon compared with July, according to figures released on Monday by the Energy Department.
The summer months experienced the most precipitous decline in U.S. petroleum demand in 26 years due to record gasoline prices and a sluggish economy. The decline was the steepest since the 1970s, which also occurred during a period of economic and energy turmoil. Continued...