DOE Boosts Diesel-Price Forecast
Diesel fuel will average $3.94 per gallon at the pump this year — more than a dollar over last year’s average and higher than the $3.62 forecast issued last month, the Department of Energy said.
The projected increase “reflects global strength in diesel demand that is contributing to a widening of the margin between diesel prices and crude oil costs since last year,” DOE said in its monthly short-term energy forecast released Tuesday.
Retail diesel prices will fall next year and average a projected $3.67 per gallon, DOE said. Diesel averaged $2.88 per gallon last year.
Gasoline will average $3.52 a gallon this year, up from last month’s $3.36 forecast and 71 cents higher than last year’s annual average price of $2.81, DOE said. The monthly average gas price will peak at $3.73 in June, DOE said.
In its weekly survey released Monday, DOE reported that diesel fell 2.8 cents from a record to average $4.149 nationwide, while gasoline rose a penny to $3.613, a record. (Click here for previous coverage.)
Oil prices will average $110 a barrel this year — up $9 from last month’s forecast. High prices will cut U.S. demand for petroleum products by 330,000 barrels a day this year, up from last month’s 210,000 barrels-per-day forecast, DOE said.
But strong demand for oil from China, India and other growing countries will keep world demand growing by about 1.2 million barrels a day this year, unchanged from last month’s forecast, the department said.
Oil prices surged past $122 a barrel for the first time Tuesday, just a day after crossing the $120 level for the first time, the Associated Press reported.
