Energy Department expects stable prices for crude and fuel this winter
The Energy Department is expecting stable crude oil prices this winter of about $83 a barrel and pump prices averaging $2.85 a gallon nationally for gasoline and more than $3 a gallon for diesel, according to the Energy Information Administration's short-term energy outlook, released Tuesday.
The $83-a-barrel figure is $3 higher than last month's prediction. The EIA also believes that crude oil prices will increase gradually to $87 a barrel by late 2011 as the nation and the world continue to recover from the recession. Crude closed Tuesday at $86.72 a barrel.
The EIA is predicting world oil consumption will grow by 2 million barrels a day this year and by 1.4 million barrels a day in 2011. Domestic crude oil production will climb by 140,000 barrels a day in 2010, but fall 40,000 barrels to 5.4 million barrels a day in 2011.
The EIA also forecast that natural gas consumption would grow 4.3% in 2010 to 65 billion cubic feet per day, largely due to increases in demand from the industrial and power generation sectors. Residential consumption, which has been flat this year, will rise by 1.8% in 2011.
There is some good news for the nation's refineries. Projected margins for petroleum product prices, currently at their lowest levels since 2003, will rise next year because of growing global demand and shutdowns of excess refining capacity.
-- Ron White