Energy prices are forecasted to increase through the second half of 2009 due to stronger than anticipated global economic activity, primarily in Asia, the U.S. Energy Department said today in its short-term energy outlook for July.
The Energy Information Administration projects that crude oil prices will average nearly $70 per barrel in 2009, an increase of about $18 compared with the average of the first half of the year. The agency forecasts crude oil spot price could rise slowly to average about $72 per barrel in 2010.
Gasoline prices will average $2.36 per gallon this year, 3 cents up from the last month's outlook projection, and then increase to $2.69 in 2010 on higher projected crude prices.
Market sentiment continues to reflect expectations of an economic recovery and a future rebound in oil demand that are outweighing weak current oil consumption and high inventory levels, the Department of Energy said on its report Tuesday.
Total natural gas consumption is projected to decline by 2.3 percent in 2009. Natural gas prices are expected to increase from an average $4.22 per thousand cubic feet to $5.93 Mcf in 2010 from $9.13 in 2008, according to the EIA.
As a result of the ongoing recession, electricity consumption is expected to fall by 2 percent in 2009, according to EIA projections. Residential electricity prices are projected to keep annual average growth in prices at around 4.7 percent in 2009.