10 January 2012 21:39 [Source: ICIS news]
WASHINGTON (ICIS)--The US Department of Energy (DOE) on Tuesday said it expects the global price of crude oil to average $100/bbl this year, about $5/bbl higher than the 2011 average, while ?xml:namespace>
In its monthly short term energy outlook (STEO) for January, the department’s Energy Information Administration (EIA) also said it expects the benchmark US crude, west Texas intermediate (WTI), will climb further in 2013 to reach $106/bbl by the fourth quarter of that year.
But in natural gas, the administration sees a starkly different outlook for 2012 pricing.
“EIA’s average 2012 Henry Hub natural gas spot price forecast is $3.53/MMBtu, a decline of almost $0.50 per MMBtu from the 2011 average spot price,” the report said.
However, that sharp decline in US natural gas pricing expected for this year likely will be offset by price increases forecast for 2013, the administration said.
EIA said it expects the Henry Hub spot price will average $4.14/MMBtu in 2013.
The price and availability of natural gas is important to US petrochemical producers and downstream chemical makers because they depend heavily on natural gas as both a feedstock and a power fuel.
The expected decline in
“Total marketed production grew by an estimated 4.5bn cubic feet per day (bcf/d) or 7.4% in 2011,” the outlook said, “the largest year-over-year volumetric increase in history.”
“This strong growth was driven in large part by increases in shale gas production,” the report said.
But production growth will be more modest this year, the department said, projected to increase by 1.4 bcf/d (2.2%) and then show an even slower expansion of some 0.7 bcf/d (1%) in 2013, the report said, citing an expected cutback in drilling plans as natural gas prices remain comparatively low.
“In the face of continued low spot and future prices as well as record high storage levels for this time of year, drillers appear to have begun cutting back on new production plans for 2012,” EIA said.
($1 = €0.78)
Paul Hodges studies key influences shaping the chemical industry in Chemicals and the Economy
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