Forecast Highlights

Global liquid fuels

  • Brent crude oil spot prices averaged $81 per barrel (b) in October, up $2/b from September. Despite the increase in monthly average prices, Brent spot prices declined from $85/b on October 1 to $75/b on October 31.
  • EIA expects Brent spot prices will average $72 in 2019 and that West Texas Intermediate (WTI) crude oil prices will average about $7/b lower than Brent prices next year. NYMEX WTI futures and options contract values for February 2019 delivery that traded during the five-day period ending November 1, 2018, suggest a range of $53/b to $83/b encompasses the market expectation for February WTI prices at the 95% confidence level.
  • EIA estimates that U.S. crude oil production averaged 11.4 million barrels per day (b/d) in October, down slightly from September levels because of hurricane-related outages in the Gulf of Mexico. EIA expects that U.S. crude oil production will average 10.9 million b/d in 2018, up from 9.4 million b/d in 2017, and will average 12.1 million b/d in 2019.
  • U.S. regular gasoline retail prices averaged $2.86 per gallon (gal) in October, an increase of 2 cents/gal from the average in September, marking the sixth consecutive month that U.S. prices averaged between $2.85/gal and $2.90/gal. EIA forecasts the average U.S. regular gasoline retail price will fall to $2.57/gal in December 2018. EIA forecasts that regular gasoline retail prices will average $2.75/gal in 2018 and in 2019.
  • EIA forecasts total global liquid fuels inventories will remain flat in 2018, followed by an increase of 0.6 million b/d in 2019.

Natural Gas

  • EIA estimates dry natural gas production in the United States averaged 86.9 billion cubic feet per day (Bcf/d) in October, up 0.7 Bcf/d from September. EIA forecasts that dry natural gas production will average 83.2 Bcf/d in 2018, up 8.5 Bcf/d from 2017. Both the level and growth of natural gas production in 2018 would establish new records. EIA expects natural gas production will continue to rise in 2019 to an average of 89.6 Bcf/d.
  • EIA estimates that U.S. natural gas storage inventories were 3.2 trillion cubic feet (Tcf) at the end of October. This level was 16% lower than both the 2017 end-of-October level and the five-year (2013–17) average for the end of October and was the lowest end-of-October level since 2005.
  • Despite low storage levels, EIA expects strong growth in U.S. natural gas production to put downward pressure on prices in 2019. EIA expects Henry Hub natural gas spot prices to average $2.98/million British thermal units (MMBtu) in 2019, down 4 cents from the 2018 average and down from a forecast average price of $3.25/MMBtu in the fourth quarter of 2018. NYMEX futures and options contract values for February 2019 delivery traded during the five-day period ending November 1, 2018, suggest a range of $2.06/MMBtu to $4.94/MMBtu encompasses the market expectation for February Henry Hub natural gas prices at the 95% confidence level.

Elecriticty, coal, renewables, and emissions

  • EIA expects the share of U.S. total utility-scale electricity generation from natural gas-fired power plants to rise from 32% in 2017 to 35% in 2018 and to 36% in 2019. EIA forecasts that the electricity generation share from coal will average 28% in 2018 and 26% in 2019, down from 30% in 2017. The nuclear share of generation was 20% in 2017 and EIA forecasts that it will average about 19% in 2018 and in 2019. Wind, solar, and other nonhydropower renewables provided slightly less than 10% of electricity generation in 2017. EIA expects them to provide more than 10% in 2018, and nearly 11% in 2019. The generation share of hydropower was 7% in 2017, and EIA forecasts that it will be about the same in 2018 and in 2019.
  • EIA expects total U.S. solar generation will rise from 212,000 Megawatt hours per day (MWh/d) in 2017 to 268,000 MWh/d in 2018 (an increase of 27%) and to 303,000 MWh/d in 2019 (an increase of 13%). In recent years, the industry has seen a shift from fixed-tilt solar PV systems to tracking systems. Although tracking systems are more expensive than fixed-tilt systems, revenue from the additional electricity generated by following the path of the sun across the sky often exceeds the increased cost.
  • U.S. coal exports for the first eight months of 2018 totaled 78 million short tons (MMst), compared with 60 MMst exported during the same period in 2017. EIA expects coal exports to total 110 MMst in 2018 and 100 MMst in 2019, and EIA expects coal production will total 756 MMst in 2018 (down 2% from 2017) and 729 MMst in 2019 (down 4% from 2018).
  • After declining by 0.8% in 2017, EIA forecasts that U.S. energy-related carbon dioxide (CO2) emissions will rise by 2.5% in 2018. This increase largely reflects higher natural gas consumption in 2018 because of a colder winter and a warmer summer than in 2017. EIA expects emissions to decline by 1.3% in 2019 because temperatures are forecast to return to normal. Energy-related CO2 emissions are sensitive to changes in weather, economic growth, energy prices, and fuel mix.