Crude Oil Outlook: Consumption Down, Production To Increase
09/10/2009 03:31PM
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U.S. Petroleum Consumption. EIA forecasts total consumption of liquid fuels and other petroleum products to decrease by about 800,000 bbl/d (4 percent) in 2009 (U.S. Petroleum Products Consumption Growth Chart) compared with 2008. During the first half of the year, consumption declined by almost 1.25 million barrels per day (6.3 percent) from the same period last year, one of the steepest declines on record. The year-over-year projected decline in petroleum consumption slows to 300,000 barrels per day (1.6 percent) in the second half of 2009 as economic recovery begins to take hold. Monthly average motor gasoline consumption in June showed an increase over the same month from the prior year for the first time since September 2007 and continues to grow over year-ago levels through the forecast. The modest economic recovery projected for 2010 contributes to a 260,000-bbl/d (1.4 percent) increase in total liquid fuels consumption, led by increases of 110,000 bbl/d (2.9 percent) in distillate consumption, 60,000 bbl/d (0.6 percent) in motor gasoline consumption, and 10,000 bbl/d (0.7 percent) in jet fuel consumption.
U.S. Petroleum Supply. EIA projects total U.S. crude oil production to average 5.24 million barrels per day in 2009 and increase to an average of 5.30 million bbl/d in 2010 (U.S. Crude Oil Production Chart). Crude oil production from the new Thunder Horse, Tahiti, Shenzi, and Atlantis Federal offshore fields accounts for about 14 percent of Lower-48 crude oil production in the fourth quarter of 2010.
U.S. Petroleum Product Prices. EIA expects the monthly average regular-grade gasoline retail price to fall from $2.62 per gallon in August and September to an average $2.56 per gallon over the last 3 months of the year. Higher projected crude oil prices in 2010 (about $12 per barrel, or 29 cents per gallon, higher than the 2009 average) increase regular-grade gasoline prices to an average of $2.70 per gallon next year. Projected diesel fuel retail prices, which averaged $2.63 per gallon in August, increase over the next few months to average $2.74 during the fourth quarter of 2009 as the winter heating fuel season begins.
Source: EIA