The beginning of 2012 has seen petroleum and gasoline usage in the U.S. fall off a cliff. In two of the last three weeks of January, gasoline usage has dropped below 8,000,000 barrels per day. The last time usage fell that low was the week of September 21, 2001.

This chart by Tim Wallace showing petroleum and gasoline usage, based on Energy Information Agency data with added polynomial trend lines, is posted by Mish Shedlock.

The weekly data in the above chart are from the Energy Information Agency. This chart from the EIA shows the four-week average, which removes much of the week-to-week “noise” and better shows the seasonal pattern and overall trend. The downward trend in gasoline consumption since 2007 and the January 2012 collapse are clearly evident.

Since 2005, global crude oil production has been bumping up against a ceiling around 74 million barrels a day.

Gregor Macdonald points out that since 2005, European oil consumption has fallen by 1.5 mbd and U.S. oil consumption by 2 mbd. Macdonald mocks any further attempt to deny the reality of peak oil:

Today, in 2012, I observe that many analysts of global oil production—and the interaction between oil prices and the global economy—continue to engage in a guessing game about the future. But, frankly, the future has already arrived. And it is not a random future, but a future that was held to be improbable, if not impossible. For each extra barrel of oil produced over the past seven years from Russia, and Canada, there has been a loss of production from the North Sea, from Mexico, from Indonesia and elsewhere. And in the case of OPEC, there has been a stubborn flatlining of production growth, which, in the true spirit of argumentum ad ignorantium, has been taken as proof of OPEC’s hidden and secret supply. Thus, we are led to the newest and strangest meme of all: the failure of global oil production to grow over seven years, in the face of a phase transition in oil prices, is not even suggestive of peak oil. But rather, proof of oil’s imminent supply resurrection.

Macdonald oblique phrase -  “a phase transition in oil prices” – refers to the fact that global crude oil supplies are proving inelastic as they no longer increase in response to price signals. Higher prices do not result in increased production, as seen in this chart posted by Gail Tverberg at Our Finite World.

With global crude oil production flat and consumption by “developing” countries such as China and India increasing, something has to give. The “give” is proving to be consumption by developed countries, including the U.S. and European countries.

Historically, economic growth has been closely correlated with oil consumption. To believe that economic growth in the U.S. can resume even while oil consumption is falling would require that the historic connection between oil consumption and growth has been broken. That’s quite a presumption.

In Europe, the most current “rescue” drama involving Greece continues. But the success of any bailout is predicated on a resumption of growth. Is anyone predicting that the downward trend in oil consumption in the EU will reverse? Tverberg points out:

[W]hen limited oil supply is rationed by high oil prices, economic growth slows down, and eventually decreases. When this happens, it becomes much less advantageous to borrow from the future, because the future is no longer better than today. If an economic contraction occurs for very long, the whole debt system can be expected to undergo a major “unwind”.

If no one can rationally expect oil supplies available to Europe and the U.S. to reverse their downward trend and once again begin increasing, what’s the basis for hope for future economic growth? For the faith that today’s debts will be repaid out of tomorrow’s growth?

One would expect that the January plunge in U.S. gasoline consumption would be reflected by a similar plunge in vehicle miles traveled. We’ll see in late March, when the Federal Highway Administration releases its Traffic Volume Trends for January 2012.