EIA forecasts stable oil prices, lower fuel consumption
In its latest short-term energy outlook, the Energy Information Administration reported crude oil prices will remain mostly stable and global liquid fuel consumption will decrease.
Released on Tuesday, Jan. 9, the report also forecasted a shift in electric generation for the second consecutive month.
“We are experiencing a significant shift in U.S. electric generation, as solar generation grows rapidly, taking market share from coal and tempering the growth in natural gas usage,” EIA Administrator Joe DeCarolis said. “Coal and natural gas remain important to the U.S. electric grid, even as variable renewable resources such as solar and wind grow.”
| Overview | |||||
| 2022 | 2023 | 2024 | 2025 | ||
| Brent crude oil (dollars per barrel) |
100.94 | 82.41 | 82.49 | 79.48 | |
| U.S. crude oil production (million barrels per day) |
11.91 | 12.92 | 13.21 | 13.44 | |
| U.S. LNG exports (billion cubic feet per day) |
10.59 | 11.84 | 12.36 | 14.43 | |
| Shares of U.S. electricity generation (percentage) |
|||||
| Natural gas | 39 | 42 | 42 | 41 | |
| Coal | 20 | 17 | 15 | 13 | |
| Renewables | 21 | 22 | 24 | 26 | |
| Nuclear | 19 | 19 | 19 | 19 | |
EIA price forecasts
EIA predicted crude oil will average $82 per barrel in 2024 before falling to $79 per barrel in 2025. Production growth is expected to outpace demand growth, allowing inventories to build and place downward pressure on prices.
Global liquid fuels production is forecast to increase by 600,000 barrels per day in 2024. By 2025, production is expected to rise by 1.6 million barrels per day.
U.S. crude oil production could set records in both 2024 and 2025. EIA has predicted 13.2 million barrels per day this year and 13.4 million barrels per day in 2025. It said this growth is driven by increases in well efficiency.
Our #STEO forecasts for OPEC+ crude #oil production:
▶️ 2024: 36.4 million barrels per day
▶️ 2025: 37.2 million barrels per dayBoth are less than the OPEC+ pre-pandemic 5-year average.
These values do not include Angola, which left OPEC.https://t.co/rA1srzrAdP pic.twitter.com/383m09kOqh
— EIA (@EIAgov) January 10, 2024
Higher and more volatile prices could result from recent developments in the Middle East.
Fuel prices have steadily declined over the past several months, and indications are that the trend will continue for much of 2024.
According to the EIA outlook, the national average price per gallon of diesel will be $3.95 in the first quarter of this year before falling to $3.90 in the second quarter and $3.85 by the third quarter. The national average is forecast to be $3.82 at the end of 2025.
The full short-term energy outlook is available on the EIA website. LL