U.S. Crude Production to Rise, Gasoline Prices to Fall Later -- EIA

Energy

Published: March 12, 2013 2:39 pm

Last Updated: April 28, 2020 9:02 am

The U.S. Energy Information Administration (EIA) today released its March version of the Short-Term Energy Outlook. The agency has lowered its forecast for the price of crude and retained its earlier forecast on the price differential between Brent and WTI.

Noting that gasoline prices fell by seven cents a gallon from February 25th to March 11th, the EIA expects gasoline prices to remain near the February average price of $3.67 a gallon for the next few months, but the average price to decline from a 2012 annual average of $3.63 a gallon to $3.55 a gallon this year and decline further to $3.38 a gallon in 2014.

The EIA now forecasts that WTI crude oil will average just under $92 a barrel in 2013, down from last month’s forecast for an average price of $93 a barrel. The agency also lowered its forecast price for Brent, from a 2013 average of $109 a barrel to $108. For 2014, the EIA forecasts WTI will average just over $92 a barrel, while Brent will average under $101 a barrel next year.

The price differential (spread) between Brent and WTI will average $16 a barrel this year and fall to $9 a barrel in 2014. The EIA believes that new pipeline capacity becoming available in the U.S. will cut the spread by moving lower cost WTI from mid-America to the Gulf Coast and thereby reduce the price of Brent.

The agency also forecasts U.S. consumption to rise slightly from 18.6 million barrels a day in 2012 to 18.7 million barrels a day by 2014. The increase is attributed to rising demand for distillates and liquefied petroleum gas (LPG). No significant change is forecast for either gasoline or jet fuel consumption.

U.S. crude oil production rose to more than 7 million barrels a day in November and December of 2012, the highest level since 1992. The EIA forecasts average production for 2013 to rise from last year’s average of 6.5 million barrels a day to 7.3 million barrels a day. Production will increase further, to 7.9 million barrels a day in 2014.

Want to Retire Early? Start Here ^(Sponsor)

Want retirement to come a few years earlier than you’d planned? Or are you ready to retire now, but want an extra set of eyes on your finances?

Now you can speak with up to 3 financial experts in your area for FREE. By simply clicking here you can begin to match with financial professionals who can help you build your plan to retire early. And the best part? The first conversation with them is free.

Click here to match with up to 3 financial pros who would be excited to help you make financial decisions.

Have questions about retirement or personal finance? Email us at [email protected]!

By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.

By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.