Global crude oil prices
- North Sea Brent crude oil sport prices dropped by US$2/bbl I March to a monthly average of US$56/bbl.
- Several factors put upward pressure on Brent prices in February, including news of falling US crude oil rig counts and announced reductions in capital expenditures by major oil companies.
- Upward price pressure abated in March, as the combination of robust world crude oil supply growth and weak global demand contributed to an increase in the rate of global inventory builds.
- Total global oil inventories are estimated to have increased by 2.1 million bpd in March.
- Strong global oil inventory builds are expected to continue in the coming months.
- The monthly average WTI crude oil spot price decreased to an average of US$48/bbl in March.
- WTI prices fell in March in large part because of commercial crude oil inventories in Cushing, Oklahoma, which increased to a record 58.9 million bbls as of March 27.
- EIA projects the Brent crude oil price will average US$59/bbl in 2015.
- The Brent crude oil price is projected to average US$75/bbl in 2016.
- WTI prices in 2015 and 2016 are expected to average uS$7/bbl and US$5/bbl, respectively, below Brent.
- The current values of futures and options contracts continue to suggest high uncertainty in the price outlook.
- Several OPEC and non-OPEC oil producers rely heavily on oil revenue to finance their national budgets and some producers have already started adjusting their upcoming budgets to reflect the crude oil price decline.
US gasoline and diesel fuel prices
- EIA expects that regular grade gasoline retail prices will average US$2.45/gal. during the 2015 summer driving season.
- Diesel fuel retail prices are projected to average US$2.77/gal. this summer.
- Because taxes and retail distribution costs are generally stable, movements in gasoline and diesel prices are driven primarily by changes in both crude oil prices and wholesale margins.
- The retail price projections reflect slowly rising prices for crude oil, best represented by the Brent crude oil price, which will average approximately US$58/bbl.
Natural gas prices
- The Henry Hub natural gas spot price averaged US$2.83 /million Btu in march.
- EIA expects monthly average spot prices to remain less than US$3 /million Btu through May, and less than US$4 /million Btu through the remainder of the forecast.
- Projected Henry Hub natural gas price averages US$3.07/ million Btu in 2015 and US$3.45 /million Btu in 2016.
Edited from report by Claira Lloyd