The Financial Times Friday May 27 1977

BY RAY DAFTER, ENERGY CORRESPONDENT

OIL CONSUMPTION dropped in the first three months of this year, a further setback for the oil industry, which has seen demand faling consistently since the 1973 crisis.

The latest Government Energy Trends report, out yesterday, shows that inland consumption of oil, on a primary fuel import basis, was 22m tonnes in the three months to the end of march, aimost 1 per cent. Tower than the corresponding period of 1976.

All the other major fuel suppliers - with the exception of hydro-electricity - registred in creased demand.

The Department of Energy reported that the output of refined oil produets was 1.6 per cent higer than last year, thanks to the call for export fuel oil. Production of fuel oil rose by 10.1 per cent were down 4.2 per cent.

Total inland energy consumption in January-March was 2.2 per cent up on the same period of 1976.

Natural gas demand rose by 3.9 per cent to 11.8m tonnes of oil equivalent. Unlike coal and oil production of gas has continued to increase throughout the 1970s.

However, Energy Trends shows that total gas sent out during the three-month period February-April was 4.6bn therms, slightly tower than in the same quarter of 1976.

Deep-mined coal production during the same period fell by 1 per cent. As a result, coal stocks fell by nearly 250 000 tons during April. At the end of the month stocks were 2.75m tons tower than last year.

Fuel for electricity generation during the firs quarter was 3.4 per cent up on 1976. Coal and nuclear power met the increased demand, while the use of oil and gas for power generation fell.