|Short-Term Energy Outlook
May 7, 2019
U.S. crude oil production averaged 12.4 million barrels per day in May, 2019, up 0.03 million barrels per day from the April average. The Energy Information Administration (EIA) forecasts total U.S. crude oil production will average 12.4 million barrels per day in 2019 and average 13.3 million barrels per day in 2020.
North Sea Brent crude oil spot prices averaged $73 per barrel in May, 2019, up from $71 per barrel in April, and $6 per barrel lower than March of last year. Brent crude is expected to average $70 per barrel in 2019 and $67 per barrel in 2020, compared with an average of $71 per barrel in 2018. West Texas Intermediate crude oil spot prices are forecast to average $10 per barrel lower than Brent in the first half of 2019 before the discount gradually falls to $4 per barrel in the fourth quarter of 2019 and throughout 2020.
Gasoline and Diesel Prices
U.S. regular gasoline retail prices averaged $2.80 per gallon in May, 2019, and is forecast to average $2.91 per gallon in June. From March to April, 2019 the average price rose 23 cents from $2.47 per gallon. April’s average price decreased 1 cent from an average of $2.46 per gallon in March of 2018.
The peak price of $4.10 per gallon for gasoline in Nebraska was reached on July 15, 2008.
On-highway diesel fuel retail prices averaged $3.08 per gallon in March, 2019, and, according to EIA, is forecast to an average the same in April. From February, 2019, March’s average price rose 8 cents, from $3.00 per gallon to $3.08 per gallon. March’s average price was 9 cents higher from an average of $2.99 per gallon in March, 2018.
The peak price of $4.77 per gallon for diesel in Nebraska was reached on July 17, 2008.
Because taxes and retail distribution costs are generally stable, movements in gasoline and diesel prices are driven primarily by changes in crude oil prices and wholesale margins. Crude oil prices that differ from the forecast would be reflected in the price of motor fuels. Each dollar per barrel of sustained change in crude oil prices relative to the forecast translates into approximately a 2.4 cent-per-gallon change in product prices.