Short-Term Energy Outlook
Short-Term Energy Outlook Highlights
- This edition of the Short-Term Energy Outlook is the first to include forecasts (monthly, quarterly and annual) through December 2012.
- EIA expects the price of West Texas Intermediate (WTI) crude oil to average about $93 per barrel in 2011, $14 higher than the average price last year. For 2012, EIA expects WTI prices to continue to rise, with a forecast average price of $99 per barrel in the fourth quarter 2012. EIA's forecast assumes U.S. real gross domestic product (GDP) grows 2.2 percent in 2011 and 2.9 percent in 2012, while world real GDP (weighted by oil consumption) grows by 3.3 percent and 3.7 percent in 2011 and 2012, respectively.
- EIA expects regular-grade motor gasoline retail prices to average $3.17 per gallon this year, 39 cents per gallon higher than last year and $3.29 per gallon in 2012, with prices forecast to average about 5 cents per gallon higher in each year during the April through September peak driving season. There is regional variation in the forecast, with average expected prices on the West Coast about 25 cents per gallon above the national average during the April through September period. There is also significant uncertainty surrounding the forecast, with the current market prices of futures and options contracts for gasoline suggesting more than a 25 percent probability that the national average retail price for regular gasoline could exceed $3.50 per gallon in the June through September period in 2011 and an 8 to 10 percent probability that it could exceed $4.00 per gallon in August and September 2011.
- Natural gas working inventories ended 2010 at 3.1 trillion cubic feet (Tcf), about 1 percent below the 2009 record-setting end-of-December level. Inventories are expected to remain at or near record-high levels through most of 2011. The projected Henry Hub natural gas spot price averages $4.02 per million Btu (MMBtu) for 2011, $0.37 per MMBtu lower than the 2010 average. EIA expects the natural gas market to begin to tighten in 2012, with the Henry Hub spot price increasing to an average $4.50 per MMBtu.
- EIA expects average household expenditures for space-heating fuels to total $990 this winter, about $22 higher than last year. EIA projects higher expenditures for heating oil and propane, flat expenditures for natural gas, but lower expenditures for electricity. A forecast of milder weather than last winter in the South and the West leads to lower fuel consumption in those areas.
- EIA projects that U.S. carbon dioxide (CO2) emissions from fossil fuels, which increased by 3.8 percent in 2010, will decline by 0.6 percent in 2011. EIA expects that CO2 emissions will increase by 2.4 percent in 2012 as consumption grows for all the fossil fuels. Projected fossil-fuel CO2 emissions in 2012 remain below the levels seen in any year from 2000 through 2008.