Onyx Power and Gas Consulting continues a weekly series providing the Short Term Energy Outlook as of May 9, 2017. This series of news articles should provide a complete insight on the current conditions of the energy…enjoy, check out archives and come back each week for additional information on how all sorts of energy sources impact our daily lives.
- North Sea Brent crude oil spot prices averaged $52 per barrel (b) in April, $1/b higher than the March average and the fifth consecutive month that Brent crude oil spot prices averaged between $50/b and $55/b. EIA forecasts Brent prices to average $53/b in 2017 and $57/b in 2018. West Texas Intermediate (WTI) crude oil prices are forecast to average $2/b less than Brent prices in both 2017 and 2018.
- NYMEX contract values for August 2017 delivery traded during the five-day period ending May 4 suggest that a range of $37/b to $63/b encompasses the market expectation for WTI prices in August 2017 at the 95% confidence level.
- For the 2017 summer driving season (April through September), U.S. regular gasoline retail prices are forecast to average $2.36/gallon (gal), compared with $2.23/gal last summer. The higher forecast gasoline price is primarily the result of higher forecast crude oil prices. The annual average price for regular gasoline in 2017 is forecast to be $2.33/gal, which, if realized, would result in the average U.S. household spending about $150 more on motor fuel in 2017 compared with 2016.
- In April, the average Henry Hub natural gas spot price was $3.10 per million British thermal units (MMBtu), 22 cents/MMBtu above the March level. New natural gas export capabilities and growing domestic natural gas consumption contribute to the forecast Henry Hub natural gas spot price rising from an average of $3.17/MMBtu in 2017 to $3.43/MMBtu in 2018. NYMEX contract values for August 2017 delivery traded during the five-day period ending May 4 suggest that a range of $2.47/MMBtu to $4.49/MMBtu encompasses the market expectation for Henry Hub natural gas prices in August 2017 at the 95% confidence level.
- Total U.S. electricity generation from utility-scale power plants averaged 11,150 gigawatthours per day in 2016. Forecast generation declines by 1.2% in 2017 and then grows by 1.9% in 2018. EIA expects the annual average U.S. residential electricity price to increase by 2.4% in 2017 and by 2.3% in 2018.
- EIA expects growth in demand for U.S. coal exports to contribute to a 5% increase in coal production in 2017. Forecast growth in coal-fired electricity generation leads to an additional 1% increase in coal production in 2018. EIA estimates the delivered coal price averaged $2.11/MMBtu in 2016, a 5% decline from the 2015 price. Coal prices are forecast to increase in 2017 and 2018 to $2.16/MMBtu and $2.22/MMBtu, respectively.