Don’t expect a respite in retail gasoline prices anytime soon. The U.S. Energy Information Administration (EIA) released its monthly outlook this week and the agency forecasts the annual average regular-grade retail gasoline price to increase from $2.78/gal. in 2010 to $3.63 in 2011, and to $3.66/gal. in 2012.
Meanwhile, the forecast for regular-grade motor gasoline at retail is projected to average $3.81/gal. during the April 1 to Sept. 30 summer driving season. That’s up significantly from last summer’s $2.76/gal. EIA forecasts the U.S. monthly average regular gasoline price during the summer to peak in June at $3.88/gal.
In addition, EIA says that futures and options contract prices for wholesale gasoline over the five days ending May 5 “suggest a 41% probability that the national monthly average retail price for regular gasoline could exceed $4/gal. during July 2011.”
Meanwhile, West Texas Intermediate (WTI) crude oil spot prices averaged $89/barrel in February, $103/barrel in March, and $110 in April. During the first week of May, WTI crude oil prices fell by nearly $17/barrel to $97, along with a broad set of commodities, but rebounded by almost $6 on May 9. However, EIA still expects oil markets to continue to tighten through 2012. Projected WTI spot prices average $103/barrel in 2011 and $107 in 2012.
To see the report, go to www.eia.doe.gov.
For the week ending May 9, the average price for regular gasoline at retail was mostly up in all U.S. regions, with the Midwest seeing the lone drop by 3¢ to $3.98, but $1.11 more than last year’s price. The East Coast was up 2¢ for the week to $3.98, and $1.06 higher than the year-ago price. The Gulf Coast was flat at $3.81 but $1.03 over last year; the Rocky Mountain region was up 3¢ to $3.72, or 82¢ higher than last year; and the West Coast was essentially flat at $4.15, but $1.05 over the year-ago price.
The national average price for diesel was down 2¢ for the week to $4.10/gal.