Short-Term Energy and Winter Fuels Outlook
October 13, 2010
- EIA projects average household expenditures for space-heating fuels will total $986 this winter (October 1 to March 31), an increase of $24, or 2.5 percent, from last winter. EIA projects higher expenditures in all fuels except electricity, where expenditures decline by 2 percent. This forecast reflects moderately higher prices for all the fuels, although slightly milder weather than last winter for much of the Nation should contribute to lower consumption in many areas.
- According to the National Oceanic and Atmospheric Administration's (NOAA) most recent projection of heating degree-days, the lower-48 states are forecast to be 3 percent warmer during the October through March winter heating season compared with last winter and 1 percent warmer than the 30-year average (1971-2000). However, heating degree-day projections vary widely between regions. For example, the Northeast, the principal market for heating oil, is projected to be about 5 percent colder than last winter, while the South is projected to be about 15 percent warmer.
- EIA expects the price of West Texas Intermediate (WTI) crude oil to average about $80 per barrel this winter, a $2.50-per-barrel increase over last winter. The forecast for average WTI prices rises gradually to $85 per barrel by the fourth quarter of 2011 as U.S. and global economic conditions improve. EIA's forecast assumes U.S. gross domestic product (GDP) grows by 2.6 percent in 2010 and 2.1 percent in 2011, while world oil-consumption-weighted GDP grows by 3.8 percent and 3.3 percent, respectively, in 2010 and 2011.
- Projected natural gas inventories reach more than 3.7 trillion cubic feet (Tcf) at the end of this year's injection season (October 31). This projected volume will be about 3 percent lower than last year's record-setting level but will still represent the second highest underground storage level on record for the month of October. The projected Henry Hub annual average spot price increases from $3.95 per million Btu (MMBtu) in 2009 to $4.47 in 2010 and $4.58 in 2011.
To see details of this forecast update, go to the following World Wide Web site on the Internet: