DOE expects retail diesel to be close to $3 next year
DOE expects OPEC surplus production capacity to remain in excess of 4 million barrels per day, compared with an average of 2.8 million barrels a day between 1998-2008.
The Trucker News Services
11/10/2009
The price of on-highway retail diesel could be close to $3 next year, averaging $2.79 in the fourth-quarter this year and $2.94 per gallon in 2010, the Department of Energy said today in its short-term energy outlook.
DOE said projected year-over-year increases in both gasoline and diesel include a small increase in refining margins as a result of the economy-related increases in product demand.
The DOE said that on Monday both diesel and gas prices dropped for the first time in five weeks, and the agency hedged its predictions of higher diesel prices in the future by noting that “if the economic recovery stalls and oil consumption does not rebound, oil prices could weaken given the high level of inventories.”
For the five days ended Nov. 5, the January 2010 West Texas Intermediate (WTI) futures contract averaged just under $80 per barrel, while WTI oil futures prices for the December 2009 contract were averaging $76 per barrel in October on the New York Mercantile Exchange, nearly $6 per barrel above the prior month’s average for that contract.
The report said that sustained economic growth in China and other Asian countries is “contributing to the beginnings of a rebound in world oil consumption, leading EIA (Energy Information Agency) to revise its expectations for world oil consumption upwards for the second consecutive month, with consumption growth increased by 0.15 million barrels per day for both 2009 and 2010” compared with the agency’s prior outlook.
DOE expects OPEC surplus production capacity to remain in excess of 4 million barrels per day, compared with an average of 2.8 million barrels a day between 1998-2008.
Higher projected crude prices also is expected to raise the price of home heating oil to $1,940 this winter compared with $1,864 last year, the agency said.
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