Reflecting the ongoing sluggish economic recovery, U.S. gasoline deliveries, a barometer of demand, declined 0.6 percent during the first half of 2010 versus the comparable year-ago period to average 8.88 million bpd, according to the American Petroleum Institute’s Monthly Statistical Report for June released Friday (7/23).

“The listless economic recovery continues to take a bite out of gasoline demand,” observed API Chief Economist John Felmy. “It’s clear from the gasoline deliveries data that consumer confidence in the economy remains shaky. This certainly supports API’s position that increased taxes or other anti-jobs policies by Congress or the administration could increase unemployment and harm our economic recovery.”

June gasoline deliveries of 9.18 million bpd were the lowest for any June since 2004 and were 0.5 percent lower than June 2009 deliveries, API reported.

Even as gasoline demand remained depressed, distillate demand—which tends to track economic output closely—improved in both the first half of the year and for June. API reported first half low and ultra-low sulfur distillate deliveries, fuel with 500ppm sulfur or less, jumped 2.1 percent from 2009 to average 3.29 million bpd, while June deliveries surged 12.3 percent from last year to average 3.51 million bpd.

For June, overall distillate fuel deliveries were 3.746 million bpd, up 5.5 percent on the year and 1.6 percent year-to-date.

According to the report, June total petroleum deliveries at 19.1 million bpd were 1.7 percent higher than June 2009, driven by an increase in deliveries of distillate fuels, jet fuel and other oils. For the first six months of 2010, total deliveries averaged 18.9 million bpd, an increase of 1.4 percent versus the first half of 2009.

Total U.S. crude oil production averaged 5.47 million bpd in the first half of 2010, a 3.5 percent increase from last year’s 5.29 million bpd. For June, crude production in the Lower 48 states rose 3.9 percent to 4.8 million bpd, while Alaskan production dipped 2.6 percent to 556,000 bpd after some North Slope operators reduced production in the middle of the month. Historically, production wanes in the summer in Alaska due to maintenance work and lower operational efficiency in warmer weather. The latest API data on well completions indicate that second quarter completions were up 21.7 percent for gas wells and 58.8 percent for oil wells.

U.S. refinery operations continued to improve in June relative to the prior month, with production of all products, except residential fuel oil, climbing on the month. Inputs to crude distillate units rose for a fifth consecutive month to average 15.3 million bpd, marking an increase of 0.6 percent from May and 0.7 percent higher than a year ago. For the first half of 2010, refinery inputs of 14.84 million bpd were 1.3 percent higher than levels reported during the first half of 2009. Operable capacity of the refineries at 17.7 million bpd in June remained flat from the prior month but was marginally higher than June 2009. On a year-to-date basis, operable capacity dipped 0.3 percent to 17.6 million bpd.

API reported that total imports of crude oil and products for the first half of the year dropped 4.6 percent versus the first half of 2009. At 11.3 million bpd, total imports for the month of June declined 2.9 percent from the month prior and fell 4.2 percent from 2009 levels.

According to the data, inventory levels of ultra-low sulfur diesel, the variety required for on-highway use, at 99.2 million bbl, increased 5.3 percent in June from the prior month and climbed 5.6 percent from inventory held a year ago. LSD supply, at 12.4 million bbl in June, registered a decline on the year but month to month gain, a trend seen in May as well. Stocks of high sulfur distillates, at 46.2 million bbl, soared 10.0 percent from prior month and gained 3.4 percent from June 2009 levels. Among distillate stocks, low sulfur stocks showed declines in the second quarter compared with that of last year.

At 352.8 million bbl in June, crude oil supply declined 2.0 percent from the prior month but rose 1.2 percent on the year. Total motor gasoline supply on-hand in June was 220.2 million bbl, a 0.8 percent gain from May’s inventory level and a 2.9 percent increase versus June 2009.