Some of the items mentioned in the June EIA Short-term Energy Outlook (STEO) forecast, released today:
Note: For additional data you can find the ‘STEO’ link in Gulfslope’s Intro.
* 4% increase in the forecast ‘average’ price of WTI showing $102.47/bbl for 2022. Forecast ‘average’ price for WTI in 2023 remains the same at $93.24/bbl.
* 4% increase in the forecast ‘average’ price of Brent reflecting $107.37/bbl for 2022. Forecast ‘average’ price for Brent in 2023 remains the same at $97.24/bbl.
* U.S. Natural Gas ‘residential average’ (dollars per thousand cubic feet) remained unchanged for 2022 and 2023 at $14.49 and $14.78, respectively. Natural gas prices are rising mainly because of three factors: natural gas inventories that are below the five-year average, steady demand for U.S. liquefied natural gas (LNG) exports, and high demand for natural gas from the electric power sector given limited opportunities for natural gas-to-coal switching.
* 10% increase in GDP for 2023 to 3.4. The forecast GDP for 2022 remains unchanged at 3.1.
* 22% decline in Russia’s forecast production of total liquid fuels down from 11.3 million b/d in 1Q22 to 9.3 million b/d in 4Q23.
* 3% increase in OPEC crude oil production which is forecast to average 29.2 million b/d in 2H22, up 0.8 million b/d from 1H22.
* U.S. natural gas fuel costs for electricity generators will increase 59% in 2022. The EIA does not expect a significant decline in generation from natural gas-fired power plants because of the limited ability of coal power plants to act as an alternative source of generation. The U.S. natural gas generation share will average 37% and 36% in 2022 and 2023, respectively.
* The U.S. residential electricity price will average 14.6 cents/kWh between June and August 2022, up 4.8% from summer 2021. The forecast summer commercial sector price averages 12.0 cents/kWh (up 4.7%) and the forecast industrial sector price averages 7.7 cents/kWh (up 3.2%). Higher retail electricity prices largely reflect higher wholesale power prices and higher natural gas prices. The EIA expects the summer increases in retail residential electricity prices will range from an increase of 2.4% in the West South Central region to a 16.1% increase in New England.
