How Premiere uses RAM? Why I read it needs so much RAM?

Good question, R.

Are you new to editing? First rule of our fight club:

There is no such thing as overkill when it comes to computer power for your NLE.
Not ever. Not never.

Your hard drives can never be large or fast enough. 
You can never have enough RAM.
You can never have too much screen real estate.
You can never have a large enough client monitor.

ETC.

Thing is: your RAM tests at 2 min. long really do not test the rigors of a supported Premiere Pro editing system. Editors create movies that are, at times, more than 2 hours long or may be 2 minutes but have 99 video tracks. You could "get away with" less RAM if your requirements are not editing 2K features or stacking up sources a mile high. System requirements are not customized and your mileage may vary. Like I just said, I am a big fan of overkill and you should be too. You're a video editor!

It's all in the way you think of your NLE. I can pass off this story to you to provide some historical perspective. Hope that's OK as it may help.

When I learned NLE in the mid 90s, a computer was but one component of a NLE system. As the most important component, Premiere Pro (and in the past for me: Avid MC, FCP, Media 100) required hardware to be specially configured, even beefed up, significantly over the requirements of standard applications in order for it to function properly. That still pretty much holds true, even 25 years later!

For the record, the other crucial components were: 
a) Video Program Monitor (not the computer monitor, with the UI playing in it. an actual video monitor showing output). For this, you needed a video capture card. In a real world studio, you'd have this monitor in your current setup. Many pros do. It's also why you see complaints on the forums around "color" and the confusions surrounding it working w/o a good monitor.

b) Studio Audio Monitors. Flat response. Usually Mackie or Genelec. "Headphones" in your cubicle is the current replacement (ugh). Usually why audio "mistakes" are commonplace and not caught. Yes, you should still strive to use studio audio monitors. Ear buds are for students and hobbyists.

c) RAID Array: We placed our standard def media (not even HD) on extremely fast drives, over 10,000 RPM. The SSDs of their day. It took 36 GB for a 30 minute show with good enough res to layback to Betacam SP. These days, rarely do editors even use fast hard drives for media, much less a second drive for media at all. This. Is. Wrong. All media needs to live on a separate SSD connected over Thunderbolt min. You see a lot of complaints around performance. When queried about an editor's media drive, I find that many don't even use one. You still need fast SSDs for your media with plenty of drive space.
d) Scratch Disk: High speed disk for cache files, audio mixdown files, and video preview files. Rarely do you find a separate high speed drive for media cache and video render files. Another reason users have trouble with performance. You still need a second high speed drive for cache if at all possible.

e) Betacam SP video deck + cabling and deck control to the computer for digitizing and exporting. We no longer need these obsolete devices. We have this little thing called "the internet" and YouTube now. We didn't even have cell phones very widely at that time! You don't need this anymore.

You've gotten the history lesson, yet one thing remains to this day: Premiere Pro is a strange bird unlike any other app running on your computer. Which other application won't function correctly without multiple hard drives: for app, for media, for cache? Without an insane amount of RAM? Without a GPU that needs 8 GB VRAM to export an effects laden composition? Not even Photoshop needs all this. 

So you see: Premiere Pro is more than just an app, it's a system and you have to treat it and think of it that way. And it's always been that way and we have to adapt our thinking and experience.

It's THE most demanding application Adobe makes with millions of lines of code. 

Differently, and more critical than any other application you'll probably use. Thank for the question. Overkill = Good.

Thanks,
Kevin