Energy prices are forecasted to remain low this year due to the economic recession and uncertainty about the recovery, Energy Department said in its short-term energy outlook for May.
The Energy Information Agency projects that crude oil prices will remain relatively flat for the rest of 2009 averaging $55 per barrel. Gasoline prices will average $2.12 per gallon this year, down 4 cents per gallon from last month's outlook projection and compared to an average of $3.26 per gallon in 2008, the EIA said.
Total natural gas consumption is projected to decline by 1.9 percent in 2009 and then increase slightly in 2010. Natural gas prices are expected to fall as low as $4.06 per thousand cubic feet from $9.13 in 2008, according to the EIA.
As a result of the ongoing recession, electricity consumption is also expected to decline by 0.8 percent this year and may return to a more normal growth rate of 1.5 percent in 2010, the EIA projects.
Despite lower demand, residential electricity prices are projected to increase by 4.4 percent in 2009 due to increased coasts to build new generation facilities, the federal agency said.
EIA's forecasts are based on assumptions that the U.S. and global economies will begin to stabilize in the coming months and show signs of recovery late in 2009 and into 2010.